The bank for central banks is expanding its CBDC research while developing a platform to monitor stablecoin balance sheets.
The Bank for International Settlements (BIS) will focus this year on testing central bank digital currencies (CBDCs) through its research and development arm and will also launch a new project to evaluate stablecoins.
On Feb. 7, the so-called “central bank” of Switzerland announced that its Innovation Hub “will focus more” on CBDC in 2023 to improve the payment system.
The bank added that its work program for the coming year also includes “Project Pyxtrial”, which it described as a new experiment launched by the branch of the BIS Innovation Hub in London to enable “systematic research of stablecoins”.
Pyxtrial will create a platform to verify stablecoin balance sheets. The bank said that many central banks do not have the tools to “systematically monitor stablecoins and avoid material conflicts”, before adding:
“This project will explore various technological tools that can help supervisors and managers create policies based on integrated data.”
For its CBDC-related work, BRI will focus on commercial CBDCs such as the two-tier system called Aurum that it is piloting in Hong Kong in July.
He said that CBDCs and payment system improvements are 15 out of 26 projects in operation in the last two years. He said that increased awareness of the central bank as a key driver.
“This priority reflects the interest and priorities of the central bank and the G20 countries’ plans to improve cross-border payments.”
It plans to test and distribute commercial CBDC through an open API ecosystem in a joint trial with the Bank of England (BOE) called Rosalind. In September, BRI concluded a pilot project for a platform called mBridge, short for Multiple CBDC Bridge. The central banks of Hong Kong, Thailand, China, and the United Arab Emirates participated in the pilot project in addition to 20 commercial banks from those countries. According to the Atlantic Council’s CBDC tracker, only 11 countries have successfully launched a CBDC, all of which are in the Caribbean except Nigeria.
There are 17 countries running the pilot project, mostly in Asia, including China, Russia, Kazakhstan, India, South Korea, Thailand, and Malaysia.
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