The Central Bank of the United Arab Emirates carried out its first cross-border digital dirham transfer on January 29 using the mBridge central bank digital currency (CBDC) platform. According to the news penned by Gulf News, a cross-border CBDC transfer worth 50 million dirhams, equivalent to 13.6 million dollars, was sent to China using the multi-CBDC mBridge platform.
UAE’s First CDBC Transaction Completed
Chairman of the Board of the Central Bank of the United Arab Emirates, Sheikh Mansur, announced that the CBDC transfer was carried out on the occasion of the golden jubilee celebrations of the central bank’s establishment. Project mBridge was jointly launched in 2021 by the central monetary authorities of China, Hong Kong, Thailand, and the UAE with the Bank for International Settlement (BIS).
This project stands out as the only international collaboration partnership that includes China. The project completed its pilot application in September 2022 and was legally launched a year later in September 2023. The mBridge platform has incorporated multiple commercial banks from each participating member country to work on infrastructure and technology.
The mBridge ledger platform uses a single-platform, direct-access infrastructure to conduct real-time, peer-to-peer transactions with the HotStuff+ consensus mechanism. The CBDC platform allows for the faster transfer of each participating country’s national digital currency.
Noteworthy Details on CBDC Projects
A member of the United States Congress also drew attention to the progress of mBridge. Representative Maxine Waters, a member of the House Financial Services Committee, expressed concerns about the project’s potential to be used as a tool to avoid economic sanctions.
Following the rise in popularity of blockchain technology and the use of cryptocurrencies on distributed ledgers, governments worldwide have begun exploring the use of blockchain technology to create a national cryptocurrency issued by the central bank.
According to a BIS report, approximately 90% of central banks worldwide are looking to adopt CBDC projects. According to the Atlantic Council’s CBDC data, out of these central banks, 11 countries have launched a CBDC project, 15 are in the pilot phase, and 26 are in the development stage.
