Sky Guo, founder of the Cypherium blockchain, predicts this Cross-border payments of digital currencies from the central bank will be made “in the next two years” or “even earlier”..
In an interview with Cointelegraph on July 13, Guo said that CBDC developments among central banks make it likely that certain countries in the European Union, China and the United States will take the lead sooner than expected and experiment with cross-border payments.
CBDC cross-border challenges
Countries around the world are experimenting with CBDC pilots at the national levellike the giant Didi, who signed “a strategic partnership” with the People’s Bank of China’s Digital Currency Research Institute. So, According to Guo, investigating cross-border payments with other CBDCs is inevitable.
However, Guo also noticed this Countries approve CBDCs differently and use different systems and technologies. If interoperability problems between chains cannot be solved, obstacles such as interaction with different payment systems could hinder the worldwide introduction of CBDCs. He added:
“CBDCs generally fall into two categories: retail and wholesale. Retail CBDCs are used for daily purchases and wholesale CBDCs are used for low-traffic bank-to-bank transactions. “
There is a solution
Guo told Cointelegraph that The Cypherium blockchain, a combination of proof-of-work (PoW) and HotStuff consensus algorithms, has already developed a cross-chain interoperability solution for CBDCs.
As one of the founding members of the OMFIF Digital Monetary Institute Guo has also participated in several virtual round tables with De Nederlandsche Bank, the European Central Bank, the Bank of France, the Institute for Digital Currency Research of the Volksbank of China and others..
As Cointelegraph previously reported, OMFIF, a global think tank for central banks, announced the launch of the Digital Money Institute to bridge the gap between digital currencies and traditional banking.