The e-krona PoC phase 4: offline payments with e-krona

Sveriges Riksbank published the fourth and final report on its e-krona proof-of-concept (PoC) work that focuses on offline payments ( the report calls it a “technical pilot” but a “pilot” involves real users transferring real central bank digital currency (CBDC) in limited ways). The solution reserves e-krona for offline use in a “shadow” wallet in the online system. The payment instrument in the form of a payment card records the shadow wallet’s balance and subsequent offline transactions. The actual e-kronas issued by the Riksbank never leave the online system and only change hands when the payment instruments are synchronized. The report concludes that offline payments are viable, but “a secure and functional offline solution requires a lot of development work on technology, regulations and processes”. [Read more at the Riksbank]

China produces CBDC guide for tourists in English

The People’s Bank of China (PBOC) Digital Currency Research Institute published a digital yuan (eCNY) how-to guide for foreigners. That includes using the eCNY app or hardware wallets in the form of payment cards or wearables. The mobile app lets visitors sign up with just their mobile phone number and supports 210 countries so far. To top up, users either link a Visa or Mastercard or visit a bank or kiosk. [Read more at Ledger Insights and download the guide here]

Israel finds transparency as key benefit of government bond tokenization

The Tel Aviv Stock Exchange (TASE) published a detailed report on the proof-of-concept it ran with Israel’s Ministry of Finance to issue a DLT-based government bond as a security token. The trial, conducted in May 2023, involved issuing the bond to a dozen banks as primary dealers. Potential benefits demonstrated included transparency (all market participants have the same visibility and can track the issuance), and accessibility (it’s easier to onboard investors). Although it found that atomic settlement eliminated counterparty risks, it requires more cash, although atomic settlement can be simultaneous without being instant. [Read more at the TASE]

*For those interested in intra-day updates, check out my searchable Diigo Fintech developments database, which is also a good place to go to query for past developments: https://www.diigo.com/user/kiffmeister/ART.

Kiffmeister’s central bank digital currency monthly monitor

Just a reminder that I produce a monthly digest of central bank digital currency (CBDC) developments exclusively for the official sector. So (only) if you work at a central bank, ministry of finance or international financial institution (e.g., the BIS, IMF, OECD, World Bank) and who would like to receive it by email on the first business day of every month, please DM me on LinkedIn or email me at chronicles@kiffmeister.com

The Sovereign Official Digital Association (SODA) is a technology-agnostic firm offering advisory services at the intersection of central banking, digital finance and the web3 industry, aiming to make public digital money a reality. SODA believes institutions in the existing financial ecosystem should have access to the tools and resources they need to move from discussion to action. SODA offers ‘real life’ use cases to help test digital money and drive adoption as central banks and other public institutions explore the future of a more financially inclusive world powered by interoperable blockchain-based networks. SODA would love you to join us on this journey – please get in touch (chris@sodapublicmoney.org).

Satoshi Capital Advisors is a New York-based, global advisory firm that works with central banks, governments, and the private sector to architect, implement, and operate varying initiatives. Satoshi Capital Advisors’ central bank work revolves around CBDC architecture and implementation, providing advisory services from research phase through to growth phase. Utilizing a product-market fit and technology agnostic approach to CBDC architecture and implementation enables Satoshi Capital Advisors to build tailored solutions, bespoke to local financial system nuances. Satoshi Capital Advisors welcomes requests from central bank officials for virtual and in-person CBDC workshops. [Click here for more information]

WhisperCash offers the first fully offline digital currency platform that has the same properties as physical cash. It can perform secure consecutive offline payments without compromising on security, privacy or accessibility. WhisperCash allows direct person to person offline payments without any server infrastructure or internet connectivity. It comes in various form factors including the self-contained credit card-sized “Pro” that sports an eInk screen and capacitive keyboard, and lasts for two weeks between recharges assuming a few transactions per day. [Click here for more information]