- The Bank of International Settlements has said that state-owned banks in China have joined in an experiment known as a multiple central bank digital currency (mCBDC) bridge test.
- Other countries around the world have also been experimenting with such tests in recent times, including Israel and Sweden.
- “By interlinking our current e-krona platform, developed in a test environment, with the other countries, we gain valuable lessons regarding cross-border payments using a CBDC,” said a representative of the test in Sweden.
China, one of the leading economies in Asia, has announced that it has been experimenting with other countries' central bank digital currency international money transfers through a partnership with central banks.
In total, more than 160 international payments were made, including some forex transfers, and over $22m was accrued during the trial.
There were central bank currencies involved from four countries around Asia. As well as China, there were also currencies from Thailand, the United Arab Emirates and Hong Kong.
The ultimate goal of the move, which is known as a multiple central bank digital currency (mCBDC) bridge test, was to reduce the cost and increase the speed and safety of such transfers.
Israel, Norway and Sweden were also recently involved in international payments experiments with digital currencies.
In this experiment, three central banks from the countries aimed to link their retail CBDC platforms.
In a statement, a representative of the relevant division at the Riksbank central bank in Sweden said that the current e-krona in the country came from a place of testing.
“By interlinking our current e-krona platform, developed in a test environment, with the other countries, we gain valuable lessons regarding cross-border payments using a CBDC,” said Mithra Sundberg, Head of the E-krona Division at Sweden’s Riksbank.
“We also gain better understanding of important design and policy choices needed to secure cross-border functionalities if we decide to issue an e-krona.”
For the Bank of Israel, meanwhile, Deputy Governor Andrew Abir said in a statement: “Efficient and accessible cross-border payments are of extreme importance for a small and open economy like Israel and this was identified as one of the main motivations for a potential issuance of a digital shekel.”
To get more information about everything that’s going on in this sector, just head over to our money transfer reviews pages where you can learn more about the way that the sector works.
