Another Country Might Come Up With a CBDC Pilot Program This Year

Central bank digital currencies (CBDCs) are considered an alternative to crypto assets. Nations across the globe are experimenting with the technology to shift people’s focus from risky investments. Recently, Mauritius is planning to release a pilot CBDC program by the end of this year. Governor of the central bank, Harvesh Kumar Seegolam, says that they have already created parameters for the pilot program.

Mauritius is Working on Digital Assets For Past Few Years

He said during the International Monetary Fund (IMF) and World Bank Community of Central Bank Technologists meeting that CBDC was his core focus while he took office in 2020. Moreover, Mauritius became the first nation to get technical assistance from the IMF regarding their CBDC project.

In February 2019, Mauritian Financial Commission (FSC) announced their plan regarding the regulatory framework for digital asset custodian services. The announcement came after a thorough discussion with the Organization of Economic Cooperation and Development (OECD) regarding governance of digital assets. In 2017, State Bank of Mauritius (SMB) partnered with SALT, a fintech firm, to use blockchain assets as collateral against loans.

Many other nations have either launched or conducted research to implement central bank digital currencies. Recently, China’s Changshu region in Jiangsu province announced that they will provide salaries in digital yuan. Additionally, the Chinese government revealed their plan to use CBDC for cross border remittances. Regulators may potentially use CBDCs for collecting taxes from the residents.

According to FreedomWorks, a Washington-based advocacy group, any bill aiming to ban CBDCs should stay clear of any loopholes before passing. Additionally, they believe that legislators must ban the ‘wholesale’ use of central bank digital currencies. The group emphasizes and supports legislation to close the loophole proscribing CBDCs to be used for ‘retail’ or consumer use.

Texas Senator, Ted Cruz, said during an interview that CBDC would deliver too much power to the government over people’s currency. Additionally, he says that the ones trying to implement the technology are the same ones opposing Bitcoin as they do not want to lose control over people’s finances.

He revealed that there are around 2 Bitcoins in his digital wallet. The Texas Senator believes the crowned cryptocurrency would act as a hedge against inflation. Previously, he said that Texas is the perfect location for BTC mining. Moreover, he has introduced legislation that would bar the Fed from creating central bank digital currency.

Representatives of both public and private banking institutions recently shared their take on the digital euro. Deputy CEO at French bank Crédit Agricole, Jerome Grivet, says that CBDCs may threaten the traditional banking business models and must be restricted to use as a payment medium rather than a store of value.

Cryptosphere is a volatile market where if an asset is proven fruit-bearing for investors, the same asset can lead to a financial blow. Regulators are trying to contain the risks associated with digital assets and CBDCs are among the technologies that can assist them at large.

Anurag S

Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.