• The Central Bank of the UAE announced it has launched the first phase of its digital dirham CBDC program.
• The first phase involves three major pillars, including researching cross-border payments, proof-of-concept work for bilateral CBDC bridges with India, and domestic CBDC issuance.
• The UAE expects to complete the first phase of its CBDC program in the next 12 to 15 months.
UAE Launches First Phase of CBDC Program
The Central Bank of the UAE (CBUAE) announced on Thursday that it has launched the first phase of its digital dirham CBDC program. H.E. Khaled Mohamed Balama, the Governor of the CBUAE, said that this initiative will „further position the UAE as a leading global financial hub.“ The country expects to complete this phase within 12 to 15 months.
Pillars of First Phase
The first phase consists of three major pillars:
This project is a collaboration between Bank for International Settlements (BIS), central banks from Hong Kong, China mainland, UAE and Thailand aimed at researching cross-border payments and multi-CBDC transactions.
2. Bilateral CBDC Bridges with India
This pillar includes proof-of-concept work for bilateral CBDC bridges with India.
3. Domestic CBDC Issuance
This pillar involves proof-of-concept work for domestic CBDC issuance covering wholesale and retail usage.
Benefits & Challenges of CDBDs
CDBDs have been discussed worldwide but some countries are reluctant while others are launching pilot programs like UAE’s CDBD program which can potentially increase economic efficiency and promote financial inclusion in their country. On the other hand, introducing such currency may also bring up issues with economic or political freedom which makes it controversial issue among people in various countries around the world..
Sen Ted Cruz’s Efforts Against UDS CDBDs h2 > Recently US Senator Ted Cruz introduced legislation to block US Digital Dollar CDBC which shows how governments around world still have mixed opinions about these currencies despite all potential benefits they might brinig along..