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September 3, 2021 by Sahana Kiran
The Bank of Internation Settlements’ aka BIS has been keeping an eye on the development of central bank digital currencies [CBDC] across the globe. In order to further spruce up the process, the bank hopes to initiate the whole cross-border system for CBDCs.
CBDCs have started to steer the world in a whole new direction. These central bank-issued assets seem to be the latest interest of governments across the globe. An array of countries have already developed the digital version of their fiat currency, however, a few others are still stuck in the research process. China has been at the top of the game as it has its asset already in use.
Now with an aim to get ahead in the race, BIS has urged the central banks of four regions namely, Australia, Malaysia, Singapore, and South Africa to join the bank’s latest initiative, Project Dunbar.
BIS’s Project Dunbar to focus on cross-border CBDCs
The aforementioned central banks have been working along with BIS to roll out a prototype that carries out cross-border CBDCs. The reason behind this is to uphold direct transactions and eliminating the requirement of intermediaries. With this prototype, the banks hope to diminish time as well as the cost of transactions.
Furthermore, the project would look into the “international dimension” of the design of the CBDC. Andrew McCormack, Head of the BIS Innovation Hub Centre in Singapore, would reportedly overlook the project.
Speaking about the same, McCormack said,
“Project Dunbar brings together central banks with years of experience and unique perspectives in CBDC projects and ecosystem partners at advanced stages of technical development on digital currencies. With this group of capable and passionate partners, we are confident that our work on multi-CBDCs for international settlements will break new ground in this next stage of CBDC experimentation and lay the foundation for global payments connectivity.”
Several bank officials from across the globe believe that this project could be great for the CBDCs of different countries.