UAE Central Bank Implements Digital Currency Strategy – Recently, the central bank of the United Arab Emirates (UAE) announced that it would begin implementing its digital currency strategy with its two partners, G42 Cloud and R3. According to a report, the two partners of the UAE’s central bank are likely to play a crucial role in facilitating CBDC implementation.
According to a recent story in Arabian Business, the first phase of the central bank’s plan, which is scheduled to occur within the next 12 to 15 months, would be centered on three main pillars. Two significant pillars are the proof-of-concept work for bilateral central bank digital currency (CBDC) bridges with India and the soft launch of the M-bridge.
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The third pillar to be evaluated is the proof-of-concept study for domestic CBDC issuance including wholesale and retail usage. Khaled Mohamed Balama, the governor of the Central Bank of the United Arab Emirates (CBUAE), stated that the decision to proceed with the CBDC program will likely strengthen the country’s status as a prominent global financial hub.
In addition, he suggested that the CBDC’s implementation will likely promote financial inclusion. “CBDC is one of the initiatives as part of the CBUAE’s FIT (Financial Infrastructure Transformation)programme, which will further position and solidify the UAE as a leading global financial hub.”
“The launch of our CBDC strategy marks a key step in the evolution of money and payments in the country. CBDC will accelerate our digitalisation journey and promote financial inclusion. We look forward to exploring the opportunities that CBDC will bring to the wider economy and society,” the governor said.
Prior to its most recent CBDC announcement, the CBUAE participated in a number of digital currency initiatives, including its 2020 collaboration with the Saudi Central Bank. In 2022, the bank will launch a cross-border CBDC program with the Hong Kong Monetary Authority and the Bank of Thailand. In addition, the Digital Currency Institute of the People’s Bank of China and the Bank for International Settlements participated in this initiative, according to the report.