Bank of England partners with MIT on its CBDC research

On March 25, the Bank of England announced that it has signed a deal with the Massachusetts Institute of Technology (MIT) Media Lab Digital Currency Initiative (DCI) for a joint 12 months-long research project on CBDC. The bank cleared that the new project is only for research purposes and does not plan to develop a functional CBDC.

England started studying about the same in 2020 and released a discussion paper in March 2020. The bank has revealed its plans on CBDC several times in the past. DCI at that time responded with how a CBDC could meet the objectives stated in the document. The central bank and treasury department of the country headed up to form an exploratory task force on the matter in April 2021. Australia released “Project Atom,” a two-year CBDC research project this Thursday, as TheCoinRise reported.

The House of Lords Economic Affairs Committee, for example, expressed mixed feelings about a potential digital pound recently in 2022, citing “advantages on the speed of settlement and cheaper and faster cross-border payments,” as well as “challenges for financial stability and the protection of privacy.”

England follows Canada and Boston

The Bank of England is not the first to team up with the Cambridge- based research university. Before this, the Federal Reserve Bank of Boston and the Bank of Canada as CBDC research partners at the DCI, the project’s creator. Last Monday, the Bank of Canada announced a year-long engagement with the DCI, while the Boston Fed began working with the DCI in 2020.

However, MIT is far from alone in this sector. CBDCs are currently being researched in around 60 nations, with about 15 pilot projects active, including China’s own digital yuan. Project Dunbar, run by the Bank of International Settlements Innovation Hub, included Australia, Malaysia, Singapore, and South Africa. Nigeria and the Bahamas have already launched their CBDCs, with Jamaica following suit in the coming quarter. Bitt, a private fintech company in Nigeria, created the eNaira.