Central Bank Digital Currency

From the Philosophical to Practical in Global Adoption

Central bank digital currency (CBDC) exploration is entering a new phase, as multiple pilot programs explore different use cases within and across markets. To drive CBDC thinking forward, Digital Asset has partnered with Cambridge University on a report detailing current CBDC standards and the technology and regulatory frameworks critical to facilitating the growth and adoption of CBDC for cross-border payments and remittance flows. 

hero-news
find-a-partner

What is CBDC?

A central bank digital currency is backed by a central bank with legal tender status, meaning it can be used to settle debts or meet financial obligations. A CBDC is often issued in addition to conventional cash, and like cash, its authenticity can be verified, it is transferable via agreed-upon transactions, and privacy of ownership is secured.

 

Daml, Digital Asset's core technology, is an ideal platform for building the foundation of a successful CBDC implementation. It supports a breadth of potential applications of CBDC, giving central banks flexibility to start with a narrow use case and expand without ledger or infrastructure restrictions.

 

Interoperability and CBDCs

Interoperability protocols are necessary for different, unrelated systems to interact with each other. Since private institutions interact with nationally managed CBDCs, interoperability is required for a successful CBDC use case, and it must be supported by the ability to clearly define rights and permissions of the various actors involved.

 

Watch Darko Pilav, Digital Asset's Director of CBDC and Payments Technology, explain the importance of interoperability in CBDC in this demo.

Cross-Border Transfer without DA

Traditional cross-border payment techniques are outdated and slow

Cross-border payments are a top priority for central bankers, as the current process is often criticized as too expensive, too slow, and too opaque, making them a drag on global productivity. Remittances in particular are an area where financial technology could make a clear improvement in outcomes especially in countries where they account for a significant component to the GDP. CBDCs offer a path forward to a process that continues to lag behind.

 

Challenges and strategies in technical implementation

The challenge of creating and implementing CBDCs is large and complex, requiring a thoughtful approach and technology solutions that not only address current challenges, but also facilitate future innovation and use case opportunity.

Digital Asset, together with Darrell Duffie of the Graduate School of Business at Stanford University, produced a detailed report examining principles for technical implementation of CBDC.  Explore the report to better understand these principles and key factors to consider for real-world CBDC use.

 

Global Map 2
Featured blog

The Regulated Liability Network: A critical step in the evolution of CBDC

Read More
Featured blog

LiquidShare and Digital Asset help shape the future of CBDCs: Three lessons learned

Read More
Featured blog

An introduction to CBDC and how to get started in Daml

Read More
Featured blog

Digital Asset open-sources Daml code for CBDC interoperability

Read More
Video

Project Genesis: Digitizing green bond issuance 

Watch the video
Featured blog

Making the Global Economic Network a reality

Get Started

Want to learn how
Digital Asset can transform
your business?

One of our specialists will be in touch to give you a firsthand look at what Daml can do.