Finance & Economics

UAE Сentral Bank Selects Technology and Legal Partners for CBDC Project

The UAE Central Bank (CBUAE) has chosen Clifford Chance, R3, and G42 Cloud as partners in the implementation of the digital currency creation project.

UAE Сentral Bank Selects Technology and Legal Partners for CBDC Project

Source: motionarray.com

The first stage of the strategy for the creation and subsequent implementation of the digital currency will be carried out for 12-15 months. This stage includes several areas of activity. It provides for the initiation of cross-border CBDC transactions with real value for settlements in international trade. Concepts for bilateral CBDC bridges with India will also be developed. Another direction will be the creation of a regulatory and technological framework for the issuance of digital currency within the country, which will cover wholesale and retail use.

As part of the implementation of the first phase of the strategy, R3 and G42 Cloud will function as technology and infrastructure providers. Clifford Chance will focus on providing legal control over this activity.

Over the past few years, the UAE Central Bank has been actively involved in international digital currency testing projects. One such project was Aber in 2020, which also involved the central bank of Saudi Arabia. The results of this testing confirmed that the digital currency issued by lenders can be used in cross-border transactions in real-time.

Last year, the UAE Central Bank was a participant in the mBridge project together with the Hong Kong Monetary Authority, the Bank of Thailand, the Digital Currency Institute of the People’s Bank of China, and the Bank for International Settlements.

His Excellency Khaled Mohammed Balama, Managing Director of CBUAE, stated that the implementation of the CBDC strategy is a fundamentally important decision in the context of the evolution of the money circulation space and the transformation of the payment sphere. He also said that in the near future, the possibilities that the use of digital currency provides for the economy and society as a whole will be explored.

The Juniper Research report contains a forecast that by 2030 the total annual volume of payments made with the help of CBDC will reach $213 billion. This level is a significant advance in comparison with the volume of transactions of $ 100 million, which is expected by the end of 2023.

As we have reported earlier, UAE and India to Test Cross-Border CBDC Use.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.