UAE Central Bank completes world’s first and largest pilot of central bank digital currencies

Gulf Today, Staff Reporter

The Central Bank of the UAE (CBUAE) has completed the first and the largest scale pilot of central bank digital currencies, being used by 20 commercial banks for real-value transactions on behalf of their corporate clients across borders, as part of "Project mBridge”.

The project is implemented in cooperation with the Hong Kong Monetary Authority, the Bank of Thailand, the Digital Currency Institute of the People's Bank of China and the Bank for International Settlements.

"Project mBridge" – the first pilot use of wholesale CBDCs in the MENA region – reflects CBUAE’s drive to create world-class financial infrastructure and innovative payment systems, which comes in line with UAE leadership’s directives to support the UAE’s economic competitiveness and empower the diversity and growth of the nation’s financial sector.

Throughout the pilot project, commercial banks in the four jurisdictions used the "mBridge” platform to conduct over 160 payment and foreign exchange transactions totalling over Dhs80 million over a six-week period, according to WAM.

The project demonstrated faster, cost-effective and secure cross-border monetary settlements using central bank money, identified as a G20 economic priority, and of positive impact for regional and international trade as well as participating entities. It provides an efficient, regulatory-compliant and scalable cross-border payment solution with CBDCs at its core, designed to operate across different jurisdictions and currencies.

On this occasion, Khaled Mohamed Balama, Governor of CBUAE, said, "The mBridge reflects the leadership vision for the UAE to be one of the leaders in CBDC development and issuance and the preferred regional hub for advanced financial infrastructure, as well as for the CBUAE to be among the top central banks globally."

"This project is part of the CBUAE plan to support UAE competitiveness, diversity and growth of the financial sector in line with future economic trends. We will continue to establish the right governance framework for interoperable CBDCs to deliver tangible benefits to UAE companies and consumers," he added.