HomeCryptoStable CoinBIS calls for immediate adoption of CBDCs

BIS calls for immediate adoption of CBDCs

Benoît Cœuré, the head of the BIS Innovation Hub, in a speech at the Eurofi Financial Forum, Ljubljana, on Friday, talked about Central Bank Digital Currencies (CBDCs). His was actually a real call to all central governors to urgently develop CBDCs to compete with payment initiatives in the private sector, including cryptocurrencies.

BIS: CBDCs have to evolve

“The pandemic has accelerated a longer-running move to digital. Mobile and contactless payments are already part of our daily lives; QR codes and ‘buy now, pay later’ options are gaining popularity; gloves, badges and Olympic uniforms with payment functions are being prepared for the Beijing Winter Olympics; and the tech-savvy generation will soon dream about money and payments for the metaverse”,

Said Coeuré arguing that to cope with this, countries have only one tool in their hands and that is to develop digital state currencies.

“Central bank money has unique advantages – safety, finality, liquidity and integrity. As our economies go digital, they must continue to benefit from these advantages. Money is at the heart of the system and it has to continue to be issued and controlled by trusted and accountable institutions which have public policy – not profit – objectives. Central bank money will have to evolve to be fit for the digital future”.

Cœuré also explained how the BIS Innovation Hub is helping central banks to develop CBDCs.

“We already have six CBDC-related proofs of concept and prototypes being developed in our centres, and more to come”.

Benoît Cœuré

What is Bis, and what is its role?

The Bank for International Settlements (BIS) is a non-profit organization, based in Basel, Switzerland, and is owned by 60 global central banks, including the European Bank, the Fed and the Bank of England.

Since 2015 the chairman of the board has been the governor of the Bank of Germany, Jens Weidmann. Its main purpose is to provide assistance and advice to central banks, promoting global monetary and financial stability through cooperation between them.

It also offers some financial services, acting as an agent for certain international payments entrusted to it by central banks. Finally, it is also a research centre for monetary, economic and financial research.

The Dunbar project for new platform prototypes

To focus this latest activity on technological innovations in 2019, the Bank’s Innovation Hub was launched and focused on six main macro-areas which are – suptech and regtech; next-generation financial market infrastructure; central bank digital currencies; open finance; cybersecurity; and green finance.

And it is precisely on CBDC projects that the innovation hub seems to have focused its attention over the past year.

At present, the “Dunbar Project”, led by the Singapore centre of BIS, is at an advanced stage, with the aim of developing prototypes of shared platforms for cross-border transactions using multiple CBDCs.

The head of the BIS Singapore centre Andrew McCormack said in July that this project brings together central banks with their years of experience and unique perspectives on CBDC projects and private ecosystem partners in advanced stages of technical development on digital currencies.

The words of the head of the Innovation hub might suggest that the project has reached a very advanced stage and that the time is ripe for the adoption of the first CDBCs

The most advanced CBDC projects in the world

Research by BIS itself in January 2021 found that 86% of the world’s central banks are studying a CBDC project anyway, 60% are already testing the technology and 14% are implementing pilot projects.

There are many CDBC projects that have been talked about for some time, starting with the digital yuan, the ruble and the Swedish krona. But even the European Central Bank announced in April that it had launched a study for a digital euro project, while the Fed is still rather doubtful about such an eventuality.

The consulting firm PwC has carried out an index on digital currencies to measure the degree of development of projects in individual countries. Around 60 CDBC projects worldwide were analyzed.

The rankings analyze projects from both a retail and an interbank perspective. On the retail side, the Bahamas project is the most advanced, followed by Cambodia, China and Ukraine. In the interbank sector, Thailand leads the list, followed by Hong Kong, Singapore and Canada.

Vincenzo Cacioppoli
Vincenzo Cacioppoli
Vincenzo was born in Genova but lived most of his life in Milan. He has a degree in political science. He is a journalist, blogger, writer, and marketing and digital advertising expert. After a long experience in traditional marketing, he started working with the web and digital advertising in 2011, creating a company called Le enfants. Passionate about the web and innovation, in 2018 he started exploring the topics related to blockchain technology and cryptocurrencies. Independent cryptocurrency trader since March 2018, he now collaborates with companies in the sector as a content marketing specialist. In his blog. mediateccando.blogspot.com, he has long been primarily focused on blockchain, which he considers to be the greatest technological innovation after the Internet. His first book about blockchain and fintech is scheduled for release in November.