The Central Bank of Taiwan has concluded a feasibility study regarding introducing wholesale central bank digital currency (CBDC) and is further deliberating on the matter.
The central bank will continue to work on platform design while soliciting input from academicians and business professionals, Deputy Governor Mei-lie Chu stated on December 7.
Chu described Banking 4.0, or “services embedded in customers’ daily lives,” in a lengthy address to bankers. This included incorporating sophisticated mobile and digital technology and artificial intelligence into the banking industry. CBDC comprised roughly fifty percent of her presentation.
Concerning research from the Bank for International Settlements, Chu stated that she recognized the benefits of CBDCs and the tokenization of physical assets. To further elaborate:
“A central bank currency with clearing finality can serve as the operational basis for tokenization.”
Particularly, Chu mentioned unified ledger technology. To facilitate system interoperability, a unified ledger, as its name suggests, operates within a “partitioned data environment” using a single ledger.
CBDC Tracker reports that Taiwan initiated CBDC research in 2020. It has made significant progress in developing a CBDC for retail use and has already piloted one with five commercial institutions and five consumers.
Chu stated that interoperability with other payment systems and bank disintermediation remained unresolved in Taiwan’s CBDC research. Chu added that the central bank is developing a CBDC in a “prudent” manner and has no timetable for a decision.
Furthermore, Fubon Bank of Taiwan, Ripple, and the Hong Kong Monetary Authority have collaborated on a pilot project involving reverse mortgages utilizing e-HKD CBDC. Additionally, its platform now supports the e-CNY digital yuan of China.