The Bank of England announced on Friday that it has reached an agreement with the Massachusetts Institute of Technology’s Media Labs Digital Currency Initiative, or DCI, for a 12-month joint research project on central banks’ digital currencies, or CBDCs. The bank said in a statement that the new project is only for research purposes and is not intended to develop direct digital currencies for the central bank.

The bank began to take a closer look at digital central bank currencies in 2020 by issuing a discussion paper in March of the same year. DCI responded by discussing how a CBDC could achieve the goals outlined in the paper. The bank and the Ministry of Finance led an investigative group on the matter in April last year, and the bank’s latest discussion paper on central banks’ digital currency was published on Thursday.

Other voices also took part in the debate, such as the House of Lords Economic Affairs Committee, which expressed mixed feelings about a potential digital pound earlier this year, referring to “the benefits of faster settlement and cheaper and faster cross-border payments”, as well as “economic problems”. “stability and privacy.

The Bank of England joins the Federal Reserve Bank of Boston and the Bank of Canada as CBDC research partners in DCI, the originator of the OpenCBDC project. Last week, the Bank of Canada announced its years of joint research, and the Boston Federal Reserve began collaborating with DCI in 2020.

The Massachusetts Institute of Technology is not alone in this field, with around 60 countries currently studying digital central bank currencies and around 15 pilot projects currently underway, including China’s domestic digital yuan. Australia, Malaysia, Singapore and South Africa participated in the Bank for International Settlements Dunbar project. Nigeria and the Bahamas have already launched their own digital currencies for live streaming, and Jamaica is expected to do so this quarter. The Nigerian eNaira is developed by the private fintech company Bitt.

Source: CoinTelegraph

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