March 28, 2024

The Central Bank of the UAE has started the practical implementation of the CBDC strategy

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The Central Bank of the UAE has started the practical implementation of the CBDC strategy

The UAE Central Bank has partnered with G42 Cloud and R3 to provide the infrastructure and technology needed to implement its CBDC strategy.

According to a representative of the Central BankUnited Arab Emirates (CBUAE), the financial institution has fully completed preliminary testing and analysis of Central Bank Digital Currency (CBDC) capabilities under CBUAE's Financial Infrastructure Transformation (FIT) Program.

In addition to this, CBUAE specialistsgot acquainted with the results of CBDC pilot projects of their market colleagues, in particular, the Hong Kong Monetary Authority, the Central Bank of Thailand, the Digital Currency Institute of the People's Bank of China and the Bank for International Settlements.

The CBUAE strategy, the stages of which are expected to bewill be completed over the next 12-15 months, includes three main components: the soft launch of mBridge to facilitate real-value cross-border CBDC transactions for international trade settlements, proof-of-concept work on bilateral CBDC bridges with India, one of the UAE's leading trading partners, as well as conceptual work on issuing a CBDC for the domestic market, covering wholesale and retail use.

To this end, CBUAE has entered into an agreement oncollaboration with the UAE cloud service provider G42 Cloud and the American technology company R3, which is part of an international consortium in the development and application of blockchain technology in the financial system. For its part, CBUAE will provide the necessary payment infrastructure and financial support for the project.

Earlier, the UAE Central Bank and the Reserve Bank of India (RBI) entered into an agreement on cooperation in the field of cross-border money transfers using government stablecoins.