Australia, Malaysia Singapore join forces to test digital currencies ‘blueprint’ but US remains ‘sceptical’
- The Bank for International Settlements’ project will look at allowing institutions to transact in the digital currencies (CBDCs) issued by the other central banks
- China, Hong Kong, Thailand and the United Arab Emirates are working on a separate project to study the feasibility of using CBDCs for cross-border payments
Central banks in Australia, Singapore, Malaysia and South Africa will join forces to test the use of multiple central bank digital currencies (CBDCs) on a shared platform for cross border payments and settlements.
Led by the Bank for International Settlements (BIS) Innovation Hub in Singapore, Project Dunbar is aimed at allowing financial institutions to transact with each other in the digital currencies issued by participating central banks, cutting the time and cost of transactions, the BIS said.
The development, which is in collaboration with technology partners in the public and private sector, is expected to publish its results early next year.
“The findings on how a common platform can be governed effectively and managed efficiently will shape the blueprint of the next generation payments systems,” said Sopnendu Mohanty, chief fintech officer at the Monetary Authority of Singapore.
As economies become cashless, around 86 per cent of 65 central banks have carried out digital currency research, while 60 per cent are conducting experiments or proof-of-concepts, the BIS said.
