01 Mar Interoperable CBDC for Trusted Web3 Commerce
Interoperable CBDC for Trusted Web3 Commerce
Individuals, SMEs, Institutions
Consumers want to participate in commerce across multiple blockchains, including public blockchains. Today, their only option is to do this with private forms of cryptocurrency that pose varying degrees of risk vs central bank money.
A solution that enables CBDC to be tokenized onto different blockchains with controls that ensure that it can be held, used, and redeemed only by authorized parties that have been properly KYC’d and risk–assessed by licensed CBDC service providers.
A ‘wrapped’ CBDC provides a safe settlement asset that can be leveraged across a range of blockchain ecosystems. CBDC is used as a tokenised value for risk-free settlement, deployed on a public blockchain for authorised transactions.
This use case offers several potential benefits. It enables consumers to participate in crypto ecosystems using trusted and reliable forms of money. It gives increased utility to sovereign currency, enabling consumers to benefit from many of the features of crypto currencies, such as programmability, while ensuring trust, security, and compliance. It also makes it easier for Web3 smart contract developers to build in support for accepting sovereign currencies as a form of payment, and potentially gives them access to an expanded set of customers.
The use case allowed the holder of pilot CBDC to purchase an NFT listed on the Ethereum public blockchain. The process “locked” the required amount of pilot CBDC on the CBDC platform and minted an equivalent amount of wrapped CBDC tokens on Ethereum. As a pre-requisite to the transaction, the Ethereum wallets of the buyer and seller, as well as the NFT marketplace smart contract, were allow-listed in the solution. It was not possible to transfer wrapped CBDC to any Ethereum wallet or smart contract that was not allow-listed, thereby demonstrating the ability to implement controls even on public blockchains.