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In a speech book At a high-level policy roundtable today, the International Monetary Fund (IMF) and Bank Al-Maghrib called for a strategic shift to a global central bank digital currency (CBDC) to improve infrastructure world of payment among users of digital assets.
Tobias Adrian, Financial Advisor and Director of the IMF’s Monetary and Capital Markets Department, pointed out that technology provides an opportunity for money to evolve. He further pointed out that technologies such as cryptography, tokenization and programmability are used globally to improve monetary systems and should be further developed.
Adrian shared a plan for a new class of cross-border and domestic contracting and payment platforms called XC platforms:
“Our plan for a new class of platforms (would ensure) greater interoperability, efficiency and security in cross-border payments, as well as in national financial markets.”
The proposed CBDC platforms are structured in three layers: establishment, programming and information management. They provide security by settling with central bank reserves, bring innovation and certainty in contracts, and manage information flows to overcome economic frictions. The platforms provide interoperability between fiat currencies and “legacy systems” and are built on transparent, rules-based governance.
Designed to settle monetary transactions in different currencies, the platforms would focus on reducing delays and high fees associated with international payments, as well as scheduling financial contracts and managing information efficiently.
The main benefit of these platforms, Adrian suggested, would be increased security, as transactions would be settled using a fairly secure form of currency – central bank reserves. The platforms would enable a multi-currency system, allowing participants to use the currency of their choice while central banks would retain control over the distribution of reserves:
“The cost, slowness and opacity of cross-border payments stem from limited infrastructure. To get global finance right, we need to unite to get global payments right. »