Saudi Arabia has announced its involvement in Project mBridge

Source: Pexels

Following this announcement fake news was circulated that this coincided with a "US-Saudi Arabia 50-year petro-dollar deal that expired" but this is untrue as per further reporting by several sources including Ledger Insights, Market Watch and UBS shows.

Cross-border CBDC transactions

Project mBridge is a project which explores a multi-central bank digital currency (CBDC) platform shared among participating central banks and commercial banks.

It is built on distributed ledger technology (DLT) to enable instant cross-border payments settlements and foreign-exchange transactions.

The project has more than 26 observing members including the South African Reserve Bank, which was greenlighted as a member this month.

The better-known observing members of mBridge are those of the Bank of Israel, Bank of Namibia, Bank of France, Central Bank of Bahrain, Central Bank of Egypt, Central Bank of Jordan, European Central Bank, the International Monetary Fund, the Federal Reserve Bank of New York, the Reserve Bank of Australia, and the World Bank.

In tandem, the project steering committee has created a bespoke governance and legal framework, including a rulebook, tailored to match the platform's unique decentralised nature.

Evolution of Project mBridge

Project mBridge is the result of extensive collaboration starting in 2021 between the BIS Innovation Hub, the Bank of Thailand, the Central Bank of the United Arab Emirates, the Digital Currency Institute of the People's Bank of China and the Hong Kong Monetary Authority.

In 2022, a pilot with real-value transactions was conducted. Since then, the mBridge project team has been exploring whether the prototype platform could evolve to become a Minimum Viable Product (MVP) – a stage now reached.

As it enters the MVP stage, Project mBridge is now inviting private-sector firms to propose new solutions and use cases that could help develop the platform and showcase all its potential.

NOTE: This article has been updated with progressed information.