The Bank of International Settlements (BIS) has announced that their digital currency for central banks is making progress this year.
Called ‘Aurum,’ the CBDC project will look at how to keep payments private when using digital currency. BIS mentioned The news was announced on Tuesday as a part of BIS’s first six projects for 2024 under its Innovation Hub work programme.
The plan wants to use the knowledge of experts from universities and privacy regulators to help central banks understand how to protect privacy when designing CBDC systems.
Cecilia Skingsley, who leads the BIS Innovation Hub, announced the projects. “As banks use new technology, we need to know how it changes the work of central banks. ” Central banks are looking into new technologies to help them do their jobs better, she emphasized.
Project Aurum is a team effort between the BIS Innovation Hub Hong Kong Centre, the Hong Kong Monetary Authority, and the Hong Kong Applied Science and Technology Research Institute.
The project was first told about in October. It is a system for buying and selling things using digital money. This means using digital money that is controlled by a central authority and stablecoins that are supported by digital money in the bank system.
Skingsley said tokenization is very important.
Moreover, the big financial company is going to use advanced technology to analyze data and make it into tokens.
Skingsley talked at a BIS meeting on Monday. She said that the BIS Innovation Hub will do more projects to test tokenizing financial instruments.
“Tokenization is an important area where we have already launched one project and are planning more initiatives.”
On January 11, a new project called ‘Promissa’ was announced. The project aims to create a platform for digital promissory notes that are turned into tokens. The International Monetary Fund (IMF) will watch and make sure the project is going well.
In addition to the Aurum CBDC project, BIS is also developing Project mBridge, which is a platform for making payments across borders using multiple CBDCs.
In September, BIS and the central banks of France, Singapore, and Switzerland said they tested and it worked well for cross-border money transfers using digital currency for big businesses. The testing, named Project Mariana, showed that wCBDCs can move between networks easily without any problems.