Worldwide testing of Digital currencies by Central Banks

Today, Central banks are researching for the possibility to issue a central bank digital currency (CBCC), while some of it are testing their currency for multiple uses. Many countries like Canada, China, Uruguay, Thailand, Sweden, Singapore and the Bahamas have advanced projects of digital currency. Moreover, India has also contributed through digital rupee in the draft cryptocurrency bill of the country. 


CBDC of China is ready:

China has recently claimed that its CBDC is almost ready. As per various media coverage, The People's Bank of China (PBOC) is near completion to issue their own sovereign digital currency of the country. This information was given at a forum which was held on Aug 10, in the northern Chinese province of Heilongjiang. Deputy director of the payment department of this bank, Mu Changchun revealed this information. 

He said that the bank will use a two-tier system and the blockchain will not be solely responsible for the digital currency as it can not handle transaction volumes in China. It was also added that the bank started looking for launching the possibility of its own CBDC in 2014. At that time, CBDC was researching intending to reduce the cost of traditional paper money and to boost the money supply control of policymakers. 


A trial between Singapore and Canada


The Bank of Canada and the Monetary Authority of Singapore (MAS) experimented on cross-currency and cross-border using CBDC. They linked up the different domestic payment networks like Project Ubin and Project Jasper. According to the MAS description, these payment networks were built on two different platforms of distributed ledger technology (DLT). The Accenture and J.P. Morgan were partners in this trial. The Canadian network development on Corda was supported by the former whereas the Singapore network on Quorum was supported by the latter. 


The MAS explained that the cross-border payments are still costly and slow, so they prefer correspondent banking network concerning cumbersome reconciliation, counterparty risk and inefficient liquidity management as well. So, both banks collaborated in order to make the cross-border payment process safer, faster and cheaper. According to the MAS:

"This is the first such trial between two central banks, and has great potential to increase efficiencies and reduce risks for cross-border payments."


Payment testing of CBDC by the Bahamas:


Bahamas is another country which is testing a CBDC. Details of discu