Three Countries Team Up With BIS to Test Cross-Border CBDCs Payments
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Three Countries Team Up With BIS to Test Cross-Border CBDCs Payments

The BIS is exploring ways to improve international payments using CBDCs in collaboration with Norway, Sweden, and Israel.
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The Bank for International Settlements (BIS) announced today it was launching project Icebreaker. This project will be undertaken together with the e-currency departments of the central banks of Israel, Norway, and Sweden, and will aim to explore the role CBDCs can play in international payments.

BIS Innovation Hub Nordic Centre Announces the Launch of Project Icebreaker

According to today’s announcements, project Icebreaker will aim to find ways for central bank backed digital currencies (CBDCs) to alleviate problems currently plaguing international settlements. According to the press release, these include high costs, low transparency, slow speeds, and limited availability.

The project will be a joint effort between the BIS Innovation Hub Nordic Centre and the central banks of Israel, Norway, and Sweden. The participating banks are to create a hub that would connect their own digital currencies, NOK, e-krona, and the digital Shekel.

This first-of-a-kind experiment will dig deeper into the technology, architecture and design choices and trade-offs, and explore related policy questions. These learnings will be invaluable for central banks thinking about implementing CBDCs for cross-border payments.

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Digital Currency Might Become the Standard for International Payments

Project Icebreaker was announced just a day after BIS announced it was very pleased with the CBDC pilot involving real value transactions conducted in cooperation with several national banks across Asia. The central banks of China, Hong Kong, Thailand, and the UAE were involved in the program.

The BIS has been working on various projects involving CBDCs for years. Already in 2021, the company stated its support for central bank digital currencies across 56 countries. Earlier this year, it was announced that SWIFT was considering ways to integrate CBDCs into its own systems.

The development of better ways to use digital currencies for international payments is likely to hasten. Even without the bounds of BIS programs, 2022 saw numerous milestones for international digital assets transactions. For example, Iran made history in August when it used crypto for foreign trading.

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Do you think that CBDCs will become the standard for international settlements? Let us know in the comments below.