Mastercard is looking to streamline the critical processes involved in central bank digital currency (CBDC) development, especially the trial stage. The company announced that it has launched a CBDC virtual testing platform on Wednesday. This is expected to support central banks in evaluating the use-cases of CBCDs before the main launch.
Mastercard’s proprietary CBDC virtual testing platform
In the announcement, the popular US electronic payment company said that its CBDC virtual testing platform would help central banks to stimulate the issuance and distribution of the digital currencies. Despite being a virtual platform, it will also enable central banks to exchange CBDCs amongst other financial entities.
One might say that Mastercard’s CBDC virtual testing platform ultimately aims to ensure that central banks will fix and avoid issues that might arise if they quickly moved on to release the digital currencies. Meanwhile, the development of the platform today comes as part of the company’s effort to support central banks in their chosen path to modernize payments, reads the announcement.
Among other things, Mastercard added that the CBDC virtual testing platform would help to “demonstrate how a CBDC can be used by a consumer to pay for goods and services anywhere Mastercard is accepted around the world.”
Just in time
The launch of the virtual platform is probably coming at the time when it is needed most. Notably, many central banks around the world are now racing with the idea of launching a potential national digital currency. Data from the Bank for International Settlements indicated that a significant percentage of banks are hosting the idea of CBDC in some ways.
However, only half of these banks have begun experimenting with the design and concept of issuing viable digital currencies.