The Reserve Bank of Australia has announced a collaboration with the Central Banks of Malaysia, Singapore, and South Africa. Project Dunbar is a collaboration aimed at evaluating the usage of central bank digital currency (CBDC) for international settlements.
“Enhancing cross-border payments has become a priority for the international regulatory community and something that we are very focused on in our domestic policy work,” said Michele Bullock, Assistant Governor (Financial System), Reserve Bank of Australia.
Here Is What You Need To Know
- The Bank for International Settlements Innovation Hub, the Reserve Bank of Australia, Bank Negara Malaysia, the Singapore Monetary Authority, and the South African Reserve Bank will test the cross-border payments system utilizing several central bank digital currencies (CBDC).
- The CBDC will be tested to see if it can make transaction settlements cheaper and easier. The project is being led by the Singapore Centre of the BIS Innovation Hub. Financial institutions will be able to transact directly in digital currencies issued by participating central banks using these multi-CBDC platforms. As a result, there will be no need for intermediaries, and transaction times and costs will be reduced.
- The project will collaborate with a number of partners to develop technological prototypes on a variety of distributed ledger systems. It will also investigate various governance and operational models that would allow central banks to share CBDC infrastructures. This access allows it to benefit from cross-jurisdictional collaboration between public and private sector expertise.
- The work of Project Dunbar will look into the worldwide dimension of CBDC design. It will also complement the G20 roadmap’s attempts to improve cross-border payments. Its findings, which are likely to be released in early 2022, will help to shape future platforms for global and regional settlements. The Singapore FinTech Festival in November 2021 will feature technical prototypes of the shared platforms built in conjunction with various technology partners.
- Centre Andrew McCormack, the head of the BIS Innovation Hub Singapore Centre, also made a statement. He believes that this initiative will “break new ground in this next stage of CBDC testing,” according to him.
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
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