CBDC: Bank of France reveals interbank settlement testing results
2 min readTL;DR Breakdown
- French Central Bank releases results of CBDC testing.
- Central banks across the world have begun massively working on their national digital currency.
The French Central Bank has released its central bank digital currency (CBDC) testing it carried out last month. The test, which used a blockchain developed by a startup in the United Kingdom, SETL, involved two million euros worth of shares that were settled on it.
While the French apex bank depended on IZNES for subscription and redemption of the fund, the bank also used smart contracts to manage the supply and circulation of the Digital Euro.
SETL, on the other hand, provided support for the facilitation of the CBDC stablecoin. Financial institutions like Citi, Groupama AM, CACEIS, and other major institutions were involved in the funds’ first settlement through CBDC.
According to the bank’s statement, more trials would be conducted on the project, and the lessons from these tests would be incorporated into further research on CBDC. A blockchain-based digital currency would help facilitate instant settlement, and as such, the primary uses of the currencies would be to trade.
The French Central bank also mentioned that the project would, in the long run, contribute to the proper functioning of a real economy.
Countries are stepping up their CBDC projects
Central banks across the world have begun to step up on their CBDC project in recent times.
Authorities in China have already begun testing their Digital Yuan’s efficiency with new ATMs that support the digital asset. The government has also started running a second test on the asset. A first test was carried out in October 2020, where the $3 million worth of the asset was shared to 100,000 residents in a lottery scheme.
European Central Bank (ECB) has also accelerated works on the project. It has been advised by the ministers of Finance of Germany and France to avoid the entrance of institutions like Facebook into the European digital currency industry.
