UAE's central bank conducts first digital Dirham transfer via mBridge CBDC platform
The Central Bank of the United Arab Emirates (UAE) executed its inaugural cross-border digital dirham transfer totaling 50 million dirhams (equivalent to $13.6 million) on January 29. This historic transaction, marking the golden jubilee celebration of the central bank's establishment, was conducted by Sheikh Mansour, the Chairman of the Board.
The mBridge platform represents a groundbreaking multinational initiative that leverages Central Bank Digital Currencies (CBDCs) for facilitating cross-border transactions.
Project mBridge, unveiled in 2021, is a collaborative endeavor involving the central monetary authorities of China, Hong Kong, Thailand, and the UAE, in conjunction with the Bank for International Settlement (BIS). Notably, it stands as the sole international partnership featuring China. Having completed its inaugural pilot in September 2022, the mBridge platform has successfully onboarded numerous commercial banks from each participating nation, engaging them in developing the requisite infrastructure and technology.
Distinguished by its employment of a single-platform, direct-access infrastructure and the HotStuff+ consensus mechanism, the mBridge ledger platform facilitates real-time, peer-to-peer transactions. This innovative CBDC platform expedites transfers of each participant country's national digital currency. Representative Maxine Waters, a member of the House Financial Services Committee in the United States, has expressed concerns about mBridge potentially being utilized to circumvent economic penalties.
The global surge in interest surrounding blockchain technology and the adoption of digital currencies on distributed ledgers has prompted governments worldwide to explore the creation of national digital currencies issued by central banks.
According to a report from the Bank for International Settlements (BIS), nearly 90% of central banks globally are actively considering the adoption of CBDCs. Among these, 11 countries have already launched CBDCs, 15 are in the pilot stage, and 26 are in the development phase, as indicated by the CBDC tracker from the Atlantic Council.
