CRYPTO

BIS said public and private cooperation was needed for the global CBDC bridge

The Bank for International Settlements (BIS) has released a new joint report with seven central banks, saying the global central bank is continuing to investigate the development of digital currency (CBDC).

BIS’s latest CBDC report, published in Sep0, is the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the United States Federal Reserve, the Sveriges Riksbank and the Swiss National Bank.

The report provides an executive summary of the progress of the investigation since the publication of a report in October 2020, outlining a general basic policy and key features of the CBDC. BIS has also published three detailed CBDC reports on the design and interoperability of CBDC systems, user needs, adoption and the impact of financial stability.

According to the new report, an effective CBDC system “requires the involvement of both public and private actors to ensure inter-operative functionality and coexistence with the larger payment system.”

The central banks participating in the report agreed that any CBDC ecosystem would balance the public and private sectors to “deliver the desired policy outcomes and enable innovations that meet the growing payment needs of users.” The ability to bridge the gap between CBDCs and traditional payment systems will be critical to the financial system, the report said.

“Yet one theme that goes through almost every consideration is inter-operability. The CBDC system contributes to the domestic inter-operability key to ensuring coexistence with other national payment systems and contributes to wider accessibility, resilience and diversity.”

Related: Working on Blockchain Interoperability Hub for Visa Crypto Payments

The Central Bank Group will continue to investigate the CBDC further, planning to increase global and domestic publicity in order to maintain an open and informed dialogue at the CBDC. “Collectively, we are sharing insights from our work with other central banks, including developing economies,” the banks noted.

Payment giant Visa officially launched its own blockchain interoperability project on block0 September, according to a new joint central bank report aimed at bringing “universal adapters” connecting multiple cryptocurrencies, stablecoins and CBDCs. Previously, tech giant Microsoft won a blockchain patent describing a cross-chain system that allows individuals and organizations to create and manage tokens across multiple distributed laser networks and platforms.