- Banking giants HSBC and IBM made a breakthrough in delivering a multi-ledger CBDC.
- The move was above board as it was under the supervision of the Bank of France.
HSBC and IBM announced a breakthrough in creating a multi-ledger central bank digital currencies (CBDC) demo. The breakthrough came after a victorious trial of a new token and digital wallet agreement of two CBDCs.
The trial involved CBDCs, forex, and bonds. The R3 Corda is at the center of foreseeing the deals on the distributed ledger.
Bank of France has a great interest in implementing CBDC
Banque de France was responsible for supervising the program. Besides the demo, it runs several trials to achieve a digital currency. Earlier, the Swiss and the French central bank noted a positive outcome. The two entities are piloting on Swiss Franc and Euro. Yet, the two banks want caution applied around the subject. Their main concern in all that was regulations.
Banque de France is keen on implementing CBDC. It has been trying out how best to use CBDC for money transactions with different banks. The trials had been ongoing since March last year. The final phase of the initial trial involved issuing digital bonds on the blockchain. The payment for the digital bond was through CBDC. Besides, several partners experimented, including banking powerhouse HSBC.
The manager of GFX eRisk, Mark Williamson, had this to say. “Interoperability in several unique ledgers and tech was vital in this course. It involved how to save time, control market risks, and enhance transaction security between banks. The institutions involved were central banks and other small financial outfits. Besides, a sample of our clientele worldwide was in the picture.”
Besides, the manager in charge of money and banking at IBM, Likhit Wagle, had this to add.
“Most central banks across the globe are exploring the ability of CBDC. Their plan is to deliver CBDC that is transparent. Also, security in the financial application and transaction is vital for them. Thus, this trial gives a detailed roadmap to achieve the implementation of CBDC.”
CBDC is taking shape
Globally, CBDC is gaining momentum. They occur as the best alternative to combat stablecoins. Most people see stablecoin as a threat to the financial system. For months, several countries have been running projects to learn the benefits of CBDCs. As a result, the Australian Reserve Bank’s Project Atom CBDC research realized several advantages of CBDC.
Moreover, the central bank of Kazakhstan saw a positive outcome on its CBDC trials. Two countries in the Eastern Caribbean also embraced the CBDC. While most countries are making entry-level moves, Russia is keen to generate a digital Ruble.
The rush to adopt digital currency is accurate. It is where the world is heading. Ukraine’s government is not letting the opportunity pass them. They have partnered with Stellar Development Foundation (SDF) to digital currency their central bank. So far, the Ukrainian government can harvest some positive outcomes from the partnership. The SDF, TASCOMBANK, and Bitt have already deployed a pilot project in achieving CBDC.
Recently HSBC and Wells Fargo launched a separate blockchain-based network to settle interbank FX, potentially removing the need for central counterparties such as CLS.