CBDC Global Bridge needs public and private collaboration, says BIS

The Bank for International Settlements (BIS) continues to investigate the evolution of a world digital currency (CBDC): has published a new joint report with seven central banks.

Released September 30th The latest CBDC GDP report covers joint efforts to explore a CBDC for retail clients with the Bank of Canada, Bank of England, Bank of Japan, European Central Bank, US Federal Reserve, Sveriges Riksbank and Swiss National Bank.

The report provides a summary of research progress since a report was published in October 2020.outlining the common founding principles and basic characteristics of a CBDC. The BPI also published three detailed reports on CBDC related to system design and interoperability, user needs, adoption, and impact on financial stability.

CBDC Global Bridge needs public and private collaboration, says BIS
CBDC Global Bridge needs public and private collaboration, says BIS

According to the new report an effective CBDC system “should involve public and private actors to ensure interoperability and coexistence with the broader payment system”.

Central banks participating in the report agreed that any CBDC ecosystem would balance the public and private sectors to “achieve the desired policy outcome and enable innovations to meet users’ changing payment needs”.. The ability to bridge the gap between CBDCs and traditional payment systems would be vital for the financial system, according to the report:

However, one topic that permeates almost all aspects is interoperability. National interoperability would be key to ensure that a CBDC system coexists with other national payment systems and contributes to greater accessibility, resilience and diversity.

The Central Banks Group will continue to study CBDC issues and plans to expand global and national reach to maintain an open and informed dialogue about CBDCs.. “Together we share the findings from our work with other central banks, including those in developing countries,” the banks stated.

The new joint central bank report comes at a time when the payments giant Visa officially unveiled its own blockchain interoperability project on September 30th, which aims to offer a “universal adapter” that connects multiple cryptocurrencies, stablecoins and CBDCs.. Tech giant Microsoft previously received a blockchain patent describing a cross-chain system that enables individuals and organizations to create and manage tokens across multiple networks and distributed ledger platforms.

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