Monetary Authority of Singapore Partners With World Bank and IMF to Launch Global CBDC Challenge
The Monetary Authority of Singapore (MAS) has launched a global challenge for financial institutions to submit ideas and solutions relating to retail Central Bank Digital Currencies (CBDCs).
The apex bank unveiled the challenge in partnership with the International Monetary Fund (IMF), World Bank, Asian Development Bank, and the Organisation for Economic Co-operation and Development.
Global Challenge To Seek Solutions For CBDC
The Global CBDC competition seeks innovative retail CBDC solutions to enhance payment efficiencies and promote financial inclusion.
Financial technology (FinTech) companies and financial establishments around the world have been invited to contest this challenge.
According to the bank, the competition would see participants submit solutions to 12 unresolved problems regarding CBDC instruments, distribution, and infrastructure.
At the end of the contest, three winners will be chosen, with each receiving S$50,000 (US$37,193) in prize money. In addition, up to 15 finalists would have the chance to receive mentorship and access to the APIX Digital Currency Sandbox.
The sandbox offers a comprehensive test and development platform, including a host of different application programming interfaces (APIs).
The chosen finalists would pitch their solutions to a global audience on Demo Day at this year’s Singapore FinTech Festival. The Singapore FinTech Festival is a global festival that will be held from 8 to 12 November 2021.
Other UN agencies which MAS partnered with on this project include the United Nations High Commission for Refugees, United Nations Development Programme, and United Nations Capital Development Fund.
The Global CBDC Challenge will also be supported by Amazon Web Services, Mastercard, payments platform Partior, blockchain software developer R3 and blockchain project Hyperledger.
Banks Around The World Working On CBDCs
Many central banks around the world are currently developing CBDCs. According to reports from Bison Trails, 80% of Central banks are studying CBDCs and making efforts to make their currencies compatible with the digital economy.
Most of these advancements are focused on wholesale CBDCs, which will promote central bank-level payments. However, some are also considering retail CBDCs, which consumers and businesses will be able to use like cash.
China still has the lead in developing and deploying CBDCs. The country is currently testing a digital Yuan version, where customers can transact payments over their mobile phones.
The US kicked off a Digital Dollar Project last month to test how a Federal Reserve-issued CBDC would operate.
The project, which consists of five pilot projects, is aimed at evaluating how the digital dollar can benefit people who are unbanked or underbanked as well as individuals who do have access to banking services and small businesses.
Meanwhile, unlike other countries, El Salvador took a more radical approach as opposed to having a CBDC. The country recently became the first to make Bitcoin a legal tender.
El Salvador is also considering mining Bitcoin using geothermal energy derived from volcanoes.