The Bank for International Settlements (BIS), the central banks of Sweden, Norway, and Israel have joined forces to study how central bank digital currency (CBDC), can be used for international retail or remittance payments. BIS made this announcement Wednesday. The Bank for International Settlements will release the results of the project in the first quarter 2023.
The BIS is an association made up of 61 central banks around the globe. It has innovation centers set up in multiple locations to explore the potential of financial technology, including CBDCs (digital versions of sovereign currencies).
The experiment has been named Project Icebreaker and the results will be released in the first quarter of 2023
Project Icebreaker is a new collaboration that involves the BIS Innovation hub’s Nordic Centre. It will test key functions as well as technical aspects of interlinking domestic CBDC systems according to a press release.
BIS stated that cross-border payments are still plagued by high costs and slow speeds, as well as insufficient transparency. According to the International Monetary Fund, CBDCs could reduce international payments.
Earlier this week, BIS Innovation Hub announced the success of a project that involved multiple Asian CBDCs and which facilitated foreign-exchange transactions worth more than $22 million.
Project Icebreaker will allow for near-instant CBDC payments to be made across borders. This will enable them to test lower costs. The final report is expected to be completed in the first quarter 2023.
Beju Shah, chief of the BIS Innovation Hub Nordic Centre, stated that “this first-of-a kind experiment will dig deeper into technology, architecture, design choices, and trade-offs and explore related policy questions.” These lessons will prove invaluable to central banks when they consider implementing CBDCs in cross-border payments.
Project Icebreaker will allow for near-instant CBDC payments to be made across borders. This will enable them to test lower costs. The final report is expected to be completed in the first quarter 2023.
Beju Shah, chief of the BIS Innovation Hub Nordic Centre, stated that “this first-of-a kind experiment will dig deeper into technology, architecture, design choices, and trade-offs and explore related policy questions.” These lessons will prove invaluable to central banks when they consider implementing CBDCs in cross-border payments.
