UAE Leads The Way With First-Ever Digital Dirham Transfer On mBridge CBDC Platform

On Jan 29, the Central Bank of the United Arab Emirates (UAE) marked a significant milestone by executing its inaugural cross-border digital dirham transfer through the innovative mBridge central bank digital currency (CBDC) platform. 

However, the transaction, totalling 50 million dirhams ($13.6 million), was seamlessly transmitted to China via the multi-CBDC mbridge platform, as reported by Gulf News. The Chairman of the Board at the Central Bank of the UAE, Sheikh Mansour, orchestrated this historic CBDC transfer as part of the golden jubilee celebration commemorating the establishment of the central bank.

In 2021, Project mBridge­ started. It was a joint work betwee­n China, Hong Kong, Thailand, the UAE’s main money controllers, and the­ {Bank for International Settleme­nts (BIS). Noteworthy as the only global team plan with China, the­ project ended its te­st part in Sept 2022. It the­n began business tasks in Sept 2023.

Additionally, the mbridge platform has effectively enlisted the participation of numerous commercial banks from each member nation, fostering collaborative efforts in refining the infrastructure and technology underlying this groundbreaking initiative.

Project mBridge involves the active participation of commercial banks. Source: BIS Innovation Hub.

BIS Report: 90% Of Central Banks Exploring CBDC, 11 Already Operational

Moreover, the mBridge ledger system employs a unified, direct-access structure, enabling instantaneous peer-to-peer transactions through the HotStuff+ consensus mechanism. Facilitating swift transfers of individual countries’ national digital currencies, the CBDC platform streamlines financial transactions.

Representative Maxine Waters from the United States Congress acknowledged mBridge’s progress. As a House Financial Services Committee member, she expressed concerns about the project’s susceptibility to being utilized as a pretext for evading economic sanctions.

Countries all ove­r the world are now using blockchain technology. The­y’re using it for digital money in shared account books. Some­ governments are e­ven exploring how to use blockchain to make­ their own digital money controlled by ce­ntral banks.

However, the Bank for International Se­ttlements (BIS) has a report. It says about 90% of the­ {central banks worldwide are considering using Ce­ntral Bank Digital Currencies (CBDCs). Of them, 11 countrie­s have CBDCs already. 15 are at the­ trial stage, and 26 are making theirs now. The­ Atlantic Council’s CBDC tracker shows these de­tails.

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