The Bank for International Settlements (BIS) continues to study the development of the global central bank digital currency (CBDC) and has published a new joint report with seven central banks.
The Bank for International Settlements CBDC’s latest report released on Thursday points to joint efforts with the Bank of Canada, Bank of England, Bank of Japan, European Central Bank, US Federal Reserve, Riksbank and Swiss National Bank to examine retail CBDCs.
The report provides a summary of the progress of the study since the publication in October 2020 of a report that sets out the general core principles and features of the Convention on Biological Diversity. BIS has also published three detailed reports on CIB currencies related to the design and interoperability of the CBDC system, user needs, implementation, and implications for financial stability.
An effective CBDC system “will need to engage both public and private actors to ensure interoperability and coexistence with the broader payment system,” according to a new report.
The central banks involved in the report agreed that any central bank’s digital currency ecosystem will engage the public and private sectors on the balance sheet to deliver “the desired policy outcome and innovation that meets the changing payment needs of users.” The report says the ability to bridge the gap between central bank currencies and traditional payment systems will be critical to the financial system:
“A topic that goes beyond all considerations is interoperability. Local interoperability can be key to ensuring the coexistence of the central bank’s digital currency system with other national payment systems and foster greater accessibility, flexibility and diversity. ”
On the subject: Visa is working on a Blockchain Interaction Center for Cryptocurrencies.
The Central Bank Group will continue to explore issues and plans for central bank digital currencies to improve global and local communication in order to maintain an open and informed dialogue about central bank digital currencies. “In general, we share the results of our work with other central banks, including developing countries,” the banks said.
The new joint central bank report came when payment giant Visa on Thursday officially unveiled its interoperability project to create a “global adapter” that connects many cryptocurrencies, stack coins and digital currencies to the central bank. Previously, tech giant Microsoft won a blockchain patent that describes a cross-chain system that allows individuals and organizations to create and manage tokens across multiple networks and distributed ledger systems.