Retail CBDC Challenge Winners Announced

The Monetary Authority of Singapore (MAS) ran a global retail CBDC challenge competition with the results announced at the Singapore Fintech festival. It received 300 submissions from over 50 countries. Three winners were selected from 15 finalists winning S$50,000 each.

  • The Consensys CBDCgo solution, in association with Visa, allows users to spend CBDCs without needing to change their payment or acceptance network.

  • The Criteo, Secretarium and Intel Atomic CBDC solution supports anonymity and privacy for small transactions and offers traceability for large transactions for anti-money laundering and countering the financing of terrorism purposes.

  • G+D Filia provides a means of payment that is inclusive and enables participation in the digital economy without a smartphone or a bank account.

Russia to Start Testing a Digital Ruble

Russia is reported to be planning to start testing a digital ruble in January 2022 according to the Izvestia newspaper. While the technology should be ready to trial in December, the necessary legislative amendments are to be implemented in January 2022, according to Anatoly Aksakov, head of the State Duma’s Financial Markets Committee. At least eight federal laws and five codes need amending concerning civil, tax, budgetary, criminal, and administrative areas.

Aksakov says that holders of fiat money and digital rubles will have the same rights and that the new currency would serve as a means of payment, appreciation, and savings. The goal is that the digital ruble will perform the same as physical cash.

12 financial institutions are part of the trial, which will be run in several phases expanding the operations and participants as the project goes on. VTB Bank, Russia’s second largest, reports that the goal is an integrated services where people can open a wallet via a mobile application and transfer the new form of national currency between individuals.

The digital ruble should reduce transaction costs and provide customers with the ability to store money securely on the central bank’s platform along with providing a unified approach to estimating the cost of transfers. As with other central banks, the vision is that a digital ruble will also allow convenient operations and the development of smart contracts, enabling greater transparency.

Saudi Moving Towards Digital Payments

Saudi Arabia has been exploring retail CBDCs for some years, according to the central bank. It launched its Project Aber back in 2019 to explore a digital riyal. It has also worked with other central banks and international organisations, partnering with the United Arab Emirates on a cross-border CBDC.

According to Fintech Saudi, this work is taking place in the context of 60% of its residents making cash payments at least once a week, with one in four using it daily. It appears younger people, those aged 16-22, are using cash less with only 18% regular cash users.

The Saudi Arabian Monetary Authority wants 70% of all payments made digitally by 2030 and this may be achieved early, perhaps as early as 2025.

PBoC Lay Out the Privacy Case for the e-CNY

The Governor of the People’s Bank of China (PBoC) recently spoke at the Bank of Finland Institute for Emerging Economies’ 30th Anniversary Conference. He laid out the steps taken by PBoC to ensure privacy for users of the e-CNY.

CoinTelegraph reported that he said that the issues surrounding the security of personal information and the digital yuan have been an area of focus. Adjustments have been made to relevant regulatory and technological areas to meet this objective. PBoC has adopted a principle of anonymity for small transactions regarding the digital yuan and will only step in to regulate using the law for large transactions. When it comes to collecting personal data, PBoC will only seek to collect what is necessary and the minimum of what is legally required, which is far less than electronic payment apps of today.

At the same time, Governor Yi Gang also spoke about the storage and utilization of personal information belonging to users of the technology. PBoC will seek to control the storage and use of personal information strictly. Unless the law demands it, PBoC will not hand over information on e-CNY users to any third-party or government agency. In recent years, China has passed multiple laws to facilitate the safety and protection of personal data from a regulatory standpoint.

The number of people with e-CNY accounts has now reached over 140 million with transaction volume over 62 billion Yuan ($9.7 billion) in October 2021. The Governor confirmed that, in time, there are plans for cross-border expansion. PBoC is working on the mCBDC Bridge with the Bank for International Settlements, the Bank of Thailand, the Central Bank of the United Arab Emirates, and the Hong Kong Monetary Authority. It has also begun technical discussions with the European Central Bank regarding the design of CBDCs.