Saudi Central Bank (SAMA) The central bank is expanding its research into digital currencies.CBDCs) but is yet to announce the deployment.
In January 23rd Bulletinthe bank said it is working on a phase of a project that “focuses on domestic wholesale CBDC use cases in collaboration with local banks and fintechs.”
However, he confirmed that no final decision has been made to launch such a digital currency in the Middle East.
“Sama emphasizes that while no decision has been made regarding the introduction of CBDC in the Kingdom, it is focused on exploring the benefits and potential risks of implementing CBDC.”
SAMA is researching multiple aspects of state-issued digital currency including economic impact, market readiness, and applications for CBDC-based payment solutions. It also intends to examine policy, legal, and regulatory considerations.
The move is part of Saudi Vision 2030, an initiative to reduce the kingdom’s dependence on oil, diversify its economy and develop public service sectors such as health, education, infrastructure, entertainment and tourism. .
According to the Governor of Sama, HE Fahad Al Mubarak, local banks and payment companies will be heavily involved in the CBDC project and its implementation.
SAMA successfully conducted a CBDC experiment called “Project Aber” in 2019. It worked with the Central Bank of the United Arab Emirates to test whether blockchain technology could support cross-border payments.
Banks Issued a report on its findings. The resulting dual-issued CBDC in late 2020 was technically viable for cross-border payments and offered “significant improvements over centralized payment systems in terms of structural flexibility.”
Related: Survey shows high penetration and adoption of crypto in Saudi Arabia.
No details were provided about the technology behind the Saudi CBDC, however CBDC Tracker suggests that it is based on the Linux Foundation’s Hyperledger Fabric.
According to a US think tank Atlantic Council, there are currently 11 countries that have fully deployed CBDC, and 17 are running pilots. Most of them are in the Caribbean, with the exception of Nigeria.
#Saudi #Central #Bank #researching #CBDC #decision #deployment