Cryptocurrencies have brought about changes that have considerably shaken the world of payment systems. In this evolving universe, CBDCs (digital central bank currencies) have gradually emerged as one of the priorities of central banks. There Bank for International Settlementsx (BIS) said more than 90% of central banks around the world are in varying stages of exploring a CBDC. Designing a CBDC is not easy, however, and comes with operational complexities that the payments company MasterCard proposes to solve.
Mastercard at the forefront of the CBDC sector
The implementation of a CBDC raises many questions, particularly in terms of the role of the private sector when issuing the CBDC, but also with regard to security, confidentiality and their interoperability. The design of a CBDC will also need to determine how it works in relation to other commonly used payment mechanisms. It is in the context of solving these problems that Mastercard has created a partner program specifically dedicated to CBDCs. This program is designed to foster collaboration with key players in the blockchain and crypto technology and payments space.
Early program partners include blockchain payments company Ripplethe blockchain and Web3 software company Consensysthe provider of multi-CBDC solutions and tokenized assets Fluencythe digital identity technology provider Idemiathe digital identity consultant Consult Hyperionthe security technology group Giesecke+Devrient and security infrastructure platform for digital assets Fireblocks. Jesse McWaters who leads international regulatory efforts at Mastercard said CBDCs should not be adopted without prior work:
(…) the CBDC Mastercard Partner Program will help central banks understand how to develop a CBDC that adds innovative and rewarding elements to the economy.
Renowned partners around the program
The initial partners of the project each bring their expertise in their own field. Ripple has designed a platform dedicated to CBDCs which allows users to customize the stages of issuing digital currency based on transactions and distribution channels. Ripple recently collaborated with the Republic of Palau for the launch of a US dollar-backed stablecoin on XRP Ledger. ConsenSys has worked on several CBDC projects as has tokenized asset solutions provider Fluency, which is involved in 23 CBDC projects.
Giesecke+Devrient is one of the oldest banknote manufacturers in the world. The company has made a shift in the digital sector with its new software, Filia. It allows central banks use distributed ledger technology to issue digital versions of their own currency. Idemia develops solutions to guarantee the confidentiality of individuals when making offline payments while maintaining sufficient oversight to prevent fraud. The company recently partnered with the Bank of England on this specific issue. Raj DhamodharanHead of Digital Assets and Blockchain Department said in the statement:
“By uniting (…) the deep expertise and diverse capabilities of these partners, we can drive innovation across the central banking community and along the CBDC value chain as the space continues to expand. ‘evolve”.
Source : MasterCard