Central Bank Digital Currencies (CBDC) have gained popularity recently. With nations adopting blockchain technology and cryptocurrency adoption on the rise, global nations are embracing CBDCs. The developments revolving around central bank digital currencies have also been on a higher scale in 2022.
Due to their less volatile nature and the fact that they are controlled by the government, CBDCs have appeared as a better option for governments worldwide. With nations launching pilot programs, India and the UAE are the latest nations to explore central bank digital currencies.
India and the UAE collaborate to conduct pilot CBDC program
According to the latest press release from the Reserve Bank of India, the RBI and the Central Bank of the United Arab Emirates (CBUAE) have signed a Memorandum of Understanding (MoU) today in Abu Dhabi, on March 15, 2023. The MoU is to collaboratively enable innovation and enhance cooperation in financial products and services.
The details from RBI reveal that the duo will collaborate on various things, including central bank digital currencies. Both the central banks will explore the interoperability between the CBDCs of the CBUAE and the RBI. They are also exploring conducting pilot CBDC testing for cross-border trade and remittances.
The press release reads:
“This bilateral engagement of testing cross-border use case of CBDCs is expected to reduce costs, increase efficiency of cross border transactions and further the economic ties between India and UAE.”
India has been quite rigid in its anti-cryptocurrency stance, whereas the United Arab Emirates is working towards establishing itself as a cryptocurrency hub. However, the future of this collaboration is definitely an interesting thing to witness as two nations with different stances on cryptocurrencies unite for CBDCs.