The UAE Central Bank has announced a strategic partnership with G42 Cloud and R3 to facilitate the implementation of their CBDC (Central Bank Digital Currency) strategy.
The CBUAE (Central Bank of the United Arab Emirates) representative has confirmed the successful completion of preliminary testing and analysis of CBDC possibilities, under the Financial Infrastructure Transformation Program (FIT) of CBUAE.
The institution’s specialists have also reviewed CBDC pilot projects of the Monetary Authority of Hong Kong, the Central Bank of Thailand, the Digital Currency Institute of the People’s Bank of China, and the Bank for International Settlements.
The CBUAE has developed a three-fold strategy with expected completion within the next 12-15 months. The initial stage involves a soft launch of mBridge, aimed at facilitating cross-border CBDC transactions for international trade settlement.
The second stage includes testing the concept of two-way CBDC bridges with India, one of the UAE’s leading trading partners, while the third stage focuses on the issuance of CBDC for the domestic market, covering both wholesale and retail use.
The CBUAE has partnered with G42 Cloud and R3, who will provide the necessary infrastructure and technology required for the project. R3 is an American technology company and a part of an international consortium specializing in the development and application of blockchain technology in the financial system.
The Central Bank of the UAE has also signed a cooperation agreement with the UAE cloud service provider, G42 Cloud. The CBUAE will provide the essential payment infrastructure and financial support for the project.
Previously, the Central Bank of the UAE and the Reserve Bank of India (RBI) had entered into an agreement on cooperation in cross-border money transfers using government stablecoins.