How Will Spain, Which Has Announced CBDC, Conduct Trials?
How will Spain, which has announced CBDC, conduct trials? The Bank of Spain (BDE), Spain’s central bank, has announced that it plans to start testing the central bank’s digital currency (CDBC).
According to the Bank of Spain, research can help determine how to adapt to “the needs and demands of an increasingly digital society”.
The Bank of Spain (BDE), Spain’s central bank, said it plans to start testing central bank digital currencies (CDBCs) and is seeking partnerships from local financial and technology companies. .
As translated from December 5 (1), the bank will focus on three main areas in the program of Aims to simulate the flow of money, testing and liquidation of financial assets and evaluate the advantages and disadvantages of introducing this wholesale. CBDC. and its current processes and resources. Bank CBDCs are usually used to store money in central banks, unlike commercial banks or CBDCs intended for the public.
The program has been described as “special” to the BDE and is not related to the work carried out in the European Union to study the use of the digital euro (2). The application must be submitted by January 31, 2023, and potential applicants must meet the bank’s minimum standards and determine their “economic means” to participate in the project.
How will this help in the end?
CBDC research can help determine the extent to which they can be involved in “responding to the needs of the community,” as the BDE aims to start this initiative. The demands of digital culture are increasing. In addition, it is said that CBDC is being investigated and tested in a few countries, mainly for commercial applications; However, it is said that most transactions that transact with CBDC are “wholesale or interbank in nature.”
At the central bank conference on December 8, Brad Jones, the deputy governor of the Reserve Bank of Australia (RBA) (3), said that commercial CBDC could make people leave commercial banks and possibly replace the Australian currency completely. According to Jones, more than 80 financial institutions have made use cases for the Australian dollar AUD CBDC test released by the RBA on August 9. However, Jones also warned that banks will face financial difficulties if CBDCs become the preferred destination for assets.
Thailand Bank (4) plans to start a pilot program for commercial CBDC at the end of 2022, with the capacity of 10,000 people for the test environment. This happened when the Bank of China started testing its e-CNY in April 2020. It is currently the most widely used CBDC in the world and has handled transactions worth $14 billion during its lifetime.