On Thursday, August 17, the Mastercard team announced plans to collaborate with Ripple and other payments companies to support the implementation of the central bank digital currency (CBDC). The Mastercard report demonstrated that the leading payment platform is interested in developing the CBDC.
In a press release, the Mastercard group stressed on the importance of CBDC in the financial sector. Besides the benefits of the CBDC, the Mastercard team will explore the limitations of the CBDC and pursue advanced ways the regulators should implement digital fiat. The payment company seeks to support the implementation of CBDC safely and securely.
Mastercard Supports CBDC Implementation
The payment company has agreed to work with seven blockchain-powered payment platforms to support the development of the CBDC. The Mastercard report demonstrated that the payment company would strive to improve the CBDC critical features including privacy, security, interoperability, and innovation.
An announcement shared by Mastercard’s head of digital assets and blockchain , Raj Dhamodharan, stated that despite the efforts made to digitize the financial sector, it was essential to ensure the value stored in the CBDC can easily be used as other currencies.
The executive noted that the Mastercard program would work closely with companies supporting the development of the CBDC. Dhamodharan stated that Mastercard would leverage the strength and vast expertise of the partners to foster innovation in the central banking sector.
The executive argued that poor implementation of the CBDC could affect the operation of the payment system and limit the growth of investment in the private sector.The payment company acknowledged the central banks’ efforts to launch the CBDC.
Besides supporting the implementation of the CBDC, the Mastercard team seeks to push the adoption of the new currency. In a recent report, analysts from Fireblocks observed that in countries where CBDC is available, people are reluctant to adopt the new currency.
Therefore payment company demonstrated a willingness to work with Ripple, the team behind the CBDC platform, and the famous software development company ConsenSys. The payment company recognized the efforts made by Ripple to support the Republic of Palau in launching its CBDC.
Additionally, the Mastercard group will collaborate with Fluency, the leading tokenized asset provider that has supported approximately 23 CBDC projects. Other companies working with Mastercard will include Giesecke+Devrient, Idemia, Consult Hyperion, and Fireblocks.
Mastercard and Ripple Participates in CBDC Launching
In 2020 the Mastercard team released a testing platform that the central bank could use to examine the CBDC system. Afterward, Mastercard supported the Bahamas in issuing prepaid cards for the CBDC.
Reportedly the Mastercard group had supported the Bank of International Settlement (BIS) and the Federal Reserve Bank in developing the CBDC. In a recent study, the BIS team observed that approximately 93% of the central banks are working on launching the CBDC. At the same time, four retail CBDCs have successfully been completed.