June 6, 2023

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 the CBDC strategy.

According to the representative of the Central BankThe United Arab Emirates (CBUAE), a financial institution, has fully completed pre-testing and analysis of the possibilities of the Central Bank Digital Currency (CBDC) under the Financial Infrastructure Transformation (FIT) Program of the CBUAE.

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

CBUAE strategy, the stages of which are expected toto 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 settlement, proof-of-concept work on bilateral CBDC bridges with India, one of the leading trading partners of the UAE, as well as conceptual work on the release of CBDC for the domestic market, covering wholesale and retail use.

To this end, the CBUAE has entered into an agreement oncooperation with the cloud service provider in the UAE G42 Cloud and the American technology company R3, which is part of an international consortium in the field of 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 Central Bank of the UAE and the Reserve Bank of India (RBI) entered into an agreement on cooperation in the field of cross-border money transfers using government stablecoins.