The Bank of Spain, Spain’s banking regulator, has announced the selection of three entities to participate in its wholesale central bank digital currency (CBDC) pilot programme, one year after issuing an open call for partners.
The Central Bank of Spain will continue its CBDC trial with Cecabank,
Abanca and Adara Blockchain. Banco de España selected the three from a pool of 24 applicants that included commercial banks, payment service providers and blockchain technology companies.
The study of a central bank digital currency (CBDC) will advance on two fronts, with the first focusing on developing a tokenized deposit solution to process and settle interbank payments. The pilot will also include a joint exploration of a cross-border central bank digital currency (CBDC) system, but it remains unclear how the offering will perform alongside the widely anticipated digital yuan.
The second phase of the CBDC study in Spain will involve a union between Cecabank and Abanca, which includes tokenized securities settlement on the blockchain. Rather than just scratching the surface, the Sicabank-Abanca consortium will explore atomic settlements for bond issuance.
The pilot program is expected to last for six months and will serve as a simulation before real-world use cases. A closer look at the central bank’s announcement suggests plans to use a wholesale CBDC system to pay coupons, with experts expecting to bring on board new participants to explore new use cases.
Independent of the digital euro
During its call for partners in late 2022, the Spanish Central Bank revealed this
Experiments with a wholesale central bank digital currency will be independent of the European Central Bank’s (ECB) efforts to roll out a digital euro.
Despite its independent studies, Spain’s central bank has hinted at fully embracing the digital euro, citing its privacy and potential offline payment function. The digital euro is expected to focus on the retail side of things while Spain’s central bank digital currency (CBDC) pilot explores the settlement of interbank transfers.
Several central banks across Europe are proceeding with their own independent studies of wholesale CBDCs, with France and Germany leading the charge.
Learn more about Central bank digital currencies Read on for some design decisions to consider when creating and launching it nChain’s CBDC playbook.
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