The Bank for International Settlements (BIS) has completed its CBDC pilot project, according to a report published by BIS. The report states that decentralized finance (DeFi) elements tested in the project could form the basis of next-generation financial market infrastructure.
CBDC Pilot Project Ended According to BIS Report
The Bank for International Settlements (BIS) has completed its CBDC pilot project. According to a report published by BIS, the pilot project of the Bank for International Settlements’ CBDC has come to an end.
The report states that decentralized finance (DeFi) elements tested in the project could form the basis of next-generation financial market infrastructure. BIS stated in the report that studies were conducted to understand whether automated market makers can simplify foreign exchange trading and settlement, and to test whether automated market makers can enhance market efficiency and reduce settlement risk.
The project demonstrated that the tested DeFi elements, including automated market makers, enable cross-border CBDC usage. However, BIS emphasized in the report that decentralized finance technologies are still developing and require further comprehensive research and experimentation.
Research will Continue
Following the completion of the CBDC pilot project, BIS published a comprehensive report on the research and testing conducted, stating that the process is not entirely concluded. BIS also added in the report that the potential benefits and challenges of decentralized finance technologies will continue to be explored.
Although the CBDC pilot program has ended, efforts towards decentralized finance technologies will continue. Additionally, the BIS General Manager made various statements regarding CBDCs during the week.
During the week, the General Manager of the Bank for International Settlements, Agustin Carstens, called for regulations on CBDCs at a conference held in Switzerland. Carstens stated that existing legal frameworks do not allow central banks to issue or use CBDCs, which he deemed unacceptable. Highlighting the current inadequacy of legal regulations, Carstens expressed that countries’ authorized institutions need to establish the necessary legal framework for CBDC usage.
