- The Central Bank of Montenegro is collaborating with Ripple to develop the country’s first digital currency.
- The digital currency will be a Central Bank Digital Currency (CBDC) or national stablecoin.
What is a CBDC?
A CBDC is a digitised version of the currency issued by central banks. Today, over a hundred countries are exploring and developing a CBDC for many use cases including widening financial inclusion, modernising monetary policy, improving payment security and increasing cross-border payments efficiency.
The Project Stages
The project will go through several stages, including identifying the practical application of a digital currency or national stablecoin and the design to simulate its circulation and use under controlled conditions.
The Central Bank of Montenegro (CBCG) has partnered with Ripple, an enterprise crypto and blockchain solutions provider, to launch the country’s first digital currency. The collaboration aims to develop a strategy and pilot programme for the introduction of a Central Bank Digital Currency (CBDC) or national stablecoin, aligned with the CBCG’s core objectives of digitising financial services and fostering greater financial accessibility for Montenegro’s citizens.
Over a hundred countries are exploring and developing CBDCs for various use cases, including improving payment security, modernising monetary policy, increasing cross-border payments efficiency, and widening financial inclusion. The CBCG will work with the Montenegrin government and academia to create a practical digital or secure currency solution to test the main blockchain technology’s functionality and potential.
The project will also analyse the advantages and risks that CBDCs or national stablecoins could pose concerning electronic means of payment availability, security, efficiency, compliance with regulations, and most importantly, the protection of end-users’ rights and privacy. The project will go through several stages, including identifying the practical application of a digital currency or national stablecoin and the design to simulate its circulation and use under controlled conditions.
Ripple’s Vice President of Central Bank Engagements & CBDCs, James Wallis, said that Ripple has a proven track record of successfully connecting disparate payment systems and championing blockchain’s utility to issue Central Bank Digital Currencies and solve global payments.
Ripple’s business solutions are faster, more transparent, and more cost-effective, solving inefficiencies that have long defined the status quo. Ripple aims to identify use cases where crypto technology will inspire new business models and create opportunities for more people.
With every solution, Ripple is realizing a more sustainable global economy and planet, increasing access to inclusive and scalable financial systems while leveraging carbon-neutral blockchain technology and a green digital asset, XRP.