The Bank for International Settlements (BIS) and the central banks of Sweden, Norway, and Israel have joined forces to investigate the potential applications of <a href="https://www.cryptoknowmics.com/news/rbi-official-central-bank-digital-currencies-could-kill-cryptocurrencies/" target="_blank" rel="noopener">central bank digital currency</a> (CBDC) for international remittance and retail payments. The BIS, an organization of 61 central banks from around the world, has innovation hubs set up worldwide to examine how new financial technology, such as CBDCs, virtualized copies of national currencies, can be employed.
<h2>Test Use of Retail CBDC</h2>
The Nordic Centre at the BIS Innovation Hub is a part of the new collaboration known as Project Icebreaker. According to a <a href="https://www.riksbank.se/en-gb/press-and-published/notices-and-press-releases/press-releases/2022/the-riksbank-tests-cross-border-payments-with-the-e-krona/" target="_blank" rel="nofollow noopener">press release</a>, it would test critical features and technical aspects of connecting various domestic CBDC systems.
<blockquote><em>"This first-of-a-kind experiment will dig deeper into the technology, architecture, and design choices and trade-offs and explore related policy questions,"</em> said Beju Shah, head of the BIS Innovation Hub Nordic Centre. <em>"These learnings will be invaluable for central banks thinking about implementing CBDCs for cross-border payments."</em></blockquote>
<h2>Cross-Border Payments</h2>
According to BIS, cross-border payments remain plagued by high costs, slow speeds, restricted access, and a lack of transparency. According to the International Monetary Fund (<a href="https://www.cryptoknowmics.com/news/regulators-must-catch-up-with-crypto-assets-says-imf/" target="_blank" rel="noopener">IMF</a>), CBDCs could lower international payment costs. Earlier this week, the BIS Innovation Hub reported completing a project involving numerous Asian CBDCs that enabled the exchange of nearly $22 million in foreign currency. Project Icebreaker would explore low-cost, instantaneous retail CBDC payments across borders. The project's final report is anticipated in the first quarter of 2023.

Sweden's Central Bank to Test Use of Retail CBDC for Instant Payments

Central banks in Sweden, Norway, and Israel are investigating potential uses of CBDC for international remittance and retail payments.

Usha is a diehard crypto enthusiast and has been actively writing on different facets of the blockchain and crypto world. She has authored many research articles on cryptocurrency and aims to provide informational and quality content to readers. She firmly believes that crypto has a great potential to redefine the world of finance and blockchain.

Sweden's Central Bank to Test Use of Retail CBDC for Instant Payments

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