All posts tagged: cbdc

Anti-CBDC Bill Cleared by House Financial Services Committee in US: Details

Anti-CBDC Bill Cleared by House Financial Services Committee in US: Details

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The US is considering rejecting the creation of a Central Bank Digital Currency (CBDC) through the Anti-CBDC Surveillance State Act. Unlike cryptocurrencies, a CBDC is a blockchain-based digital version of fiat currency issued and regulated by a central bank.Republican lawmakers, led by Congressman Tom Emmer, are pushing this bill to prevent financial surveillance of US citizens. Emmer, who serves on the House Financial Services Committee, sponsored the legislation, which passed the committee this week with a 27-22 vote. The US stance on CBDCs contrasts sharply with nations like India, Russia, and China, which are already conducting advanced trials of their own digital currencies. The bill now awaits a vote by the full House of Representatives, with a date yet to be announced. Key Highlights of the Proposed Act In an April 3 statement, Tom Emmer announced that 114 of his House Republican colleagues support the Anti-CBDC Surveillance State Act. Emmer argued that, “a CBDC is government-controlled programmable money that, if designed without privacy protections of cash, could give the federal government unilateral authority to surveil …

Kazakhstan and UAE Central Banks Sign MoU to Collaborate on VDA Regulations, CBDCs

Kazakhstan and UAE Central Banks Sign MoU to Collaborate on VDA Regulations, CBDCs

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Kazakhstan, aiming to advance trials of its digital Tenge CBDC this year, has sought the UAE’s expertise to explore the Web3 sector. In a recent development, the National Bank of Kazakhstan signed an MoU with the Central Bank of the UAE (CBUAE) to collaborate on fintech, cybersecurity, and CBDCs. Kazakhstan also intends to leverage the UAE’s experience in regulating virtual digital assets (VDAs) to shape its own regulatory framework. A delegation from Kazakstan’s National Bank visited the UAE last week to meet with officials from the CBUAE. During the meeting, officials from both agencies discussed topics like digital assets regulation and CBDC uses, the National Bank said in a statement. Key Details About the Meetings During their UAE visit, officials from the National Bank of Kazakhstan met with leaders from the Abu Dhabi Global Market (ADGM) and the Dubai Financial Centre Authority (DFSA). Their focus was to learn how UAE’s financial hubs leverage advanced technologies for payments and transactions. Kazakhstan is evaluating whether similar strategies can be implemented within its crypto-friendly Astana International Financial Centre …

UAE Plans to Launch Digital Dirham CBDC, Integrated Wallet in Q4 2025

UAE Plans to Launch Digital Dirham CBDC, Integrated Wallet in Q4 2025

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The Central Bank of the UAE (CBUAE) plans to launch its Digital Dirham central bank digital currency (CBDC) between October and December. On Thursday, the bank said that the Digital Dirham token will improve security and efficiency of financial transactions, while reducing the costs of facilitating national and international payments. The CBUAE has also created a wallet to simplify the management and use of its upcoming CBDC. A CBDC is the digital representation of a fiat currency, issued on a blockchain. Each CBDC token carries the same value as its physical counterpart. Transactions facilitated through CBDCs leave permanent records on the subsequent blockchain — enhancing transparency in existing financial systems while reducing the dependency of cash notes. The CBUAE disclosed these details about its upcoming CBDC, and unveiled a new symbol for the digital and fiat version of its fiat currency. CBUAE Governor Khaled Mohamed Balama said that he expects the Digital Dirham to boost national financial stability and inclusion, along with helping law enforcement agencies to combat financial crime. “It will enable the development …

South Korea’s Central Bank to Start CBDC Trials for Real-World Transactions: Reports

South Korea’s Central Bank to Start CBDC Trials for Real-World Transactions: Reports

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South Korea’s central bank is set to launch CBDC trials for real-world transactions under the “Digital Test Project Hangang,” according to local reports citing BoK officials. The three-month programme is said to involve seven banks and 100,000 participants that will be testing blockchain technology’s role in finance. The BoK reportedly sees this large-scale pilot as an opportunity to assess whether the Digital Won CBDC can help reshape the country’s fintech ecosystem. Starting in April, trial participants can convert their bank deposits into “deposit tokens,” with individual holdings capped at KRW 1 million (roughly Rs. 59,000) and a total limit of KRW 5 million (roughly Rs. 2.95 lakh) throughout the pilot, according to a Korea Times report. Later this month, the Bank of Korea (BoK) is said to release guidelines for joining the trial. To launch the pilot, the BoK will issue its CBDC to banks, which will then distribute deposit tokens to participants. These tokens can be used for payments at select stores and merchants, Business Korea report a claimed. Payments will reportedly be processed …

Birla Institute of Management Technology Launches Bimcoin, a Blockchain-Based Campus Currency 

Birla Institute of Management Technology Launches Bimcoin, a Blockchain-Based Campus Currency 

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India’s Birla Institute of Management Technology (BIMTECH) has debuted a blockchain-based campus currency called Bimcoin. The token has been designed to facilitate secure and transparent transactions within the institute’s ecosystem for students, administrators, and vendors. An official launch statement circulated by the institute says that the initiative has been inspired by India’s central bank digital currency (CBDC)-related efforts and aims to cater to the “growing need” to integrate blockchain into existing real-world systems like finance. “Unlike conventional financial systems, Bimcoin leverages blockchain’s decentralised nature, ensuring transparency, and incorporating programmable features such as smart contracts,” the statement from BIMTECH said. Bimcoin Pilot Trials Bimcoin has undergone pilot trials where the campus currency saw 1,100 completed transactions. During the trials, some issues around user onboarding and other technical integrations were identified, the institute said. BIMTECH claimed that it conducted “iterative testing and user training” to fix the issues found during the pilot phase. Bimcoin is scheduled to undergo close-net testing before it sees a campus-wide rollout. The Institute did not share a timeline for the completion of …

What is the ‘REDI’ Framework for CBDC Adoption Suggested by IMF

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India is one of several countries actively working to integrate Central Bank Digital Currencies (CBDCs) into their financial systems. Over the weekend, the International Monetary Fund (IMF) proposed a framework aimed at facilitating widespread adoption of CBDCs, known as REDI, which stands for Regulation, Education, Design and Deployment, and Incentives. In its latest report, the IMF indicated that many jurisdictions are likely to view CBDCs as crucial policy tools for enhancing financial inclusion in the near future. The IMF has noted that a new payment instrument such as a CBDC could face multiple challenges in terms of adoption, especially when its performance is currently being tested by only a handful of countries. Understanding REDI IMF’s report notes that the CBDC ecosystem must be regulated to ensure the safety of finances. A participation margin for intermediaries has been mentioned by the IMF to ensure oversight by financial regulators of the countries that are experimenting with CBDCs. The report also proposes that the CBDCs must be given the status of a legal tender alongside fiat currencies. Echoing …

RBI’s CBDC Yet Another Step in Taking Indian Payments Ahead, JPMorgan Blockchain Head Says

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The Reserve Bank of India (RBI) is overseeing the creation and distribution of the eRupee CBDC for retail and wholesale payment purposes. The central bank’s approach towards exploring the inclusion of the eRupee into the existing financial system has been praised by Naveen Mallela, global co-head of Onyx, JPMorgan’s blockchain and digital currency unit. Mallela was speaking along the sidelines of the Global Fintech Fest 2024 being held in Mumbai when he praised the RBI for gradually infusing blockchain with the existing financial system after extensive trials. “CBDCs is yet another step in taking Indian payments ahead. Such an understanding would emerge from the generation of user data in pilots. The actual introduction of CBDC can be phased in gradually,” Mallela reportedly said on Thursday. A CBDC (Central Bank Digital Currency) like the eRupee is the blockchain representation of fiat currencies, issued and regulated by the central banks. While they work like cryptocurrencies in terms of facilitating quick financial transactions, they are overseen and controlled by financial authorities. In India, the eRupee stepped into its …

Brazil’s CBDC Pilot Reportedly Delayed to 2025 Due to Lack of Privacy Safeguards: Details

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Brazil has reportedly halted the pilot testing of Drex, its central bank digital currency (CBDC), The pilot of the country’s first CBDC will take place by 2025, as the Central Bank of Brazil has found blockchain privacy solutions to be insufficient, which could cause financial inconvenience to Brazilian nationals, according to a report that states the South American nation has decided to conduct privacy trials on its CBDC with the help of third-party institutions. This will be phase two of Drex’s trials, with a major focus on privacy. Brazil’s CBDC Project Reportedly Delayed to 2025 The Banco Central do Brasil (BCB) will launch Drax into the second phase of trials in July this year. It has been designed to be part of a blockchain system supported by the Ethereum-based Hyperledger Besu. According to a Valor Econômico report (in Portuguese), the launch of the CBDC has been delayed to 2025. The central bank is looking to finetune the country’s financial compliance, banking, and tax secrecy regulations. Cybersecurity firms like Zether and Parfin are working with Brazilian …

RBI Proposes Support for CBDC Distribution via Non-Bank Payment Operators

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Several countries, including India, are expanding central bank digital currency (CBDC) trials, hoping to integrate then with their existing financial systems. The Reserve Bank of India has proposed the expansion of support for the digital rupee CBDC within the retail ecosystem beyond banks. In the coming days, the RBI is expected to start circulating the digital rupee through payment system operators who are not part of the banking system. The detail was disclosed on Friday in a statement by RBI Chief General Manager Yogesh Dayal. Until now, India’s CBDC distribution was being conducted by banks that are part of its trials. Moving forward, however, RBI is likely to allow platforms like Google Pay and PhonePe also to distribute the digital rupee in the retail ecosystem. “CBDC pilots in the retail and wholesale segments are underway with more use-cases and more participating banks. Continuing with this approach, it is proposed to make CBDC-retail accessible to a broader segment of users in a sustained manner, by enabling non-bank payment system operators to offer CBDC wallets,” Dayal said …

SWIFT Plans to Launch New Central Bank Digital Currency Platform Within Next Two Years

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Global bank messaging network SWIFT is planning a new platform in the next one to two years to connect the wave of central bank digital currencies now in development to the existing finance system, it has told Reuters. The move, which would be one of the most significant yet for the nascent CBDC ecosystem given SWIFT’s key role in global banking, is likely to be fine-tuned to when the first major ones are launched. Around 90% of the world’s central banks are now exploring digital versions of their currencies. Most don’t want to be left behind by bitcoin and other cryptocurrencies, but are grappling with technological complexities. SWIFT’s head of innovation, Nick Kerigan, said its latest trial, which took 6 months and involved a 38-member group of central banks, commercial banks and settlement platforms, had been one of the largest global collaborations on CBDCs and “tokenised” assets to date. It focused on ensuring different countries’ CBDCs can all be used together even if built on different underlying technologies, or “protocols”, thereby reducing payment system fragmentation …