China, Thailand, UAE, BIS Test Cross-Border CBDC Payments

The Bank for International Settlements (BIS) says it has carried out the first pilot of a central bank digital currency (CBDC) involving “four jurisdictions and real-value transactions.”

According to a statement published Tuesday (Sept. 27) on the BIS LinkedIn page, the pilot involved the BIS Innovation Hub Hong Kong Centre, Hong Kong Monetary Authority, the Bank of Thailand, the Digital Currency Institute of The People’s Bank of China and the Central Bank of The United Arab Emirates.

The bank said the test took place from Aug. 15 to Sept. 23 on the mBridge Ledger, which it called a custom-developed distributed ledger technology (DLT) platform.

“The 20 participating commercial banks used the platform to settle different kinds of payments for corporate customers, focusing on cross-border trade,” the BIS said. “Over $12 million in value was issued onto the platform facilitating over 160 cross-border payments and FX transactions totalling more than $22 million in value.”

Read more: 3 Reasons a Digital Dollar Is Still a Long Way Off

The test comes as economists and officials in the U.S. are expressing reservations that the country is ready for its own digital currency.

Last week, Bank of America analysts Alkesh Shah and Andrew Moss released a report acknowledging that their earlier projecting calling a digital dollar “inevitable” was “too optimistic” — saying now that “it’s better to be right than first when it comes to CBDC issuance.”

And a recent report by the White House Office of Science and Technology Policy names several dozen reasons why an American CBDC could be a long way off.

See also: Sweden, Norway and Israel Central Banks Test Cross-Border CBDC Payments

This week also saw the central banks of Sweden and Israel announce they will explore the use of CBDCs in international retail and remittance payments in collaboration with the central bank of Norway and the BIS.

“Project Icebreaker” will see the banks create a “hub” connecting their domestic proof-of-concept CBDC systems, with the goal of testing specific key functions and the technological feasibility of interlinking different national CBDC systems.

The project will run through year’s end, with a final report expected in the first quarter of 2023.