Sveriges Riksbank, Sweden’s central bank, is teaming up with peers in Israel and Norway and the Bank for International Settlements (BIS) to test instant payments via retail cross-border central bank digital currency (CBDC), according to a press release on Wednesday. 

See related article: Warnings on crypto, Bitcoin have materialized, says central bank body BIS 

Fast facts

  • The “Project Icebreaker” program will continue till the end of the year, with a final report expected in the first quarter of 2023, the press release said.
  • “This first-of-a-kind experiment will dig deeper into the technology, architecture, and design choices and trade-offs and explore related policy questions,” said Beju Shah, Head of the BIS Innovation Hub Nordic Center. “These learnings will be invaluable for central banks thinking about implementing CBDCs for cross-border payments.”
  • “Project Icebreaker” is the fourth cross-border CBDC project that BIS has participated in; the other three are mBridge, Project Dunbar and Project Jura.
  • On Tuesday, a BIS consultant said central banks of Hong Kong, mainland China, Thailand and the United Arab Emirates and BIS had concluded the pilot of the cross-border CBDC project mBridge, in which foreign exchange transactions totaling more than US$22 million in value have been made.
  • Currently, 105 countries, which account for more than 95% of global GDP, are exploring CBDC, and ten countries have fully rolled out, according to the data from the Atlantic Council. The think tank also pointed out that interoperability between CBDCs could be the next challenge to be tackled for seamless cross-border payments. 

See related article: IMF looks to build platform for cross-border CBDC transactions