The UAE Central Bank achieved an important milestone by executing its first cross-border digital dirham transfer worth 50 million dirhams ($13.6 million) to China using the mBridge platform on January 29, marking a new era in digital currency transactions.
On January 29, the Central Bank of the United Arab Emirates (UAE) made a groundbreaking move in the field of digital currencies by conducting its first cross-border digital dirham transfer. This transfer, amounting to 50 million dirhams (equivalent to $13.6 million), was sent to China using the central bank’s mBridge digital currency (CBDC) platform.
The transfer was overseen by Sheikh Mansoor, Chairman of the Board of the Central Bank of the UAE, during the celebration of the bank’s golden jubilee. This event is not only an important moment for the UAE, but also a remarkable step in the global advancement of digital currencies.
The mBridge platform, introduced in 2021, is a joint effort between the central monetary authorities of China, Hong Kong, Thailand and the UAE, in partnership with the Bank for International Settlements (BIS). It stands out as the only international cooperative partnership that includes China. Project mBridge’s first pilot was completed in September 2022, and since then it has engaged multiple commercial banks from each participating nation to develop its infrastructure and technology.
mBridge uses a single-platform direct access architecture, leveraging the HotStuff+ consensus mechanism to facilitate real-time, peer-to-peer transactions. This innovative approach enables faster transfers of each participating country’s national digital currency, demonstrating the CBDC’s potential to streamline cross-border payments.
The use of blockchain and distributed ledger technology for digital currencies has generated significant interest worldwide. According to a BIS report, nearly 90% of the central banks globally are exploring CBDC adoption. Among them, 11 countries have already launched CBDCs, 15 are in the pilot stage, and 26 are in the development phase. This trend shows a growing recognition of the potential benefits and efficiencies that CBDCs can bring to the global financial system.
The success of the UAE dirham digital transfer through mBridge highlights the growing integration of blockchain technology into national and international finance, potentially changing the future of remittances and economic transactions worldwide.
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