Private Sector Invited to Assist BIS in Advancing Multi-CBDC Project mBridge
Summary:
The Bank of International Settlements (BIS) is inviting private sector proposals to aid in the evolution of Project mBridge, a multi-central bank digital currency initiative. Launched in 2021, the project seeks to address inefficiencies like high costs and operational complexities in cross-border payments, with the ultimate goal of creating a universally accessible multi-CBDC system. The project was initiated by the BIS Innovation Hub, in partnership with the central banks of Thailand, the UAE, China, and Hong Kong authorities. The plan is to launch a viable product capable of handling real-world transactions, with mBridge compatible with the Ethereum Virtual Machine (EVM).
The Bank of International Settlements (BIS) has initiated a multi-central bank digital currency (multi-CBDC) venture, Project mBridge, and is calling for private sector involvement to evolve its prototype into a minimal functional product (MFP). Launched in 2021, Project mBridge was brought to life by the BIS Innovation Hub in partnership with the central banks of Thailand, the United Arab Emirates, China, and Hong Kong officials. Later Saudi Central Bank along with 26 other observing institutions participated in the venture. The goal was to probe CBDCs' capabilities to tackle inefficiencies in traditional cross-border payments, like exorbitant charges, slow speed, and operational complexities, with an ultimate aim of setting up a globally accessible multi-CBDC framework.
The principal participants of mBridge have over time designed a prototype platform, which entails the creation of the mBridge blockchain for immediate peer-to-peer cross-border and foreign exchange transactions. The project has now called for proposals from private businesses to suggest innovative solutions and potential use-cases to assist in further advancement of the platform.
The intent to initiate the mBridge MFP was unveiled in September 2023 by the CEO of Hong Kong Monetary Authority (HKMA), Eddie Yue. The project so far has demonstrated its ability to execute faster, cost-effective, and transparent cross-border payments. However, the incorporation of corporate sector entities was not initially planned. Expressing his anticipation of more central bank collaborations, Yue revealed that the project is on verge of launching its minimally viable product aimed to set the ground for mBridge's gradual monetisation.
The mBridge MFP is designed to efficiently handle real-world transactions and is built to be compatible with the Ethereum Virtual Machine (EVM). recent data from BIS suggests a global trend among all central banks to incorporate generative artificial intelligence (AI) tools for enhancing the cybersecurity protocols. Although these generative AI tools have significantly upgraded the banks' capability in providing swift response to cyber threats and detecting suspicious activities, the cost of its implementation is a major issue.
Published At
6/5/2024 3:05:56 PM
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