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  • Writer's pictureJamal Saafir

Mastercard Announces Success With Wrapped CBDC Trial

According to a report from Cointelegraph, Mastercard has successfully completed a trial using wrapped central bank digital currencies (CBDCs) on multiple blockchains.

“As the digital economy continues to mature, Mastercard has seen demand from consumers to participate in commerce across multiple blockchains, including public blockchains. This technology not only has the potential to drive more consumer choice, but it also unlocks new opportunities for collaboration between the public and private networks to drive genuine impact in the digital currency space,” said Richard Wormald, Division President, Australasia at Mastercard.

Per the October 12th announcement, the trial was performed with the Reserve Bank of Australia (RBA) and the country’s Digital Finance Cooperative Research Centre (DFCRC), along with participation from Cuscal and Mintable. In a live environment, Mastercard stated that the solution granted a CBDC owner the ability to purchase a nonfungible token (NFT) listed on Ethereum in a live environment. “The process ‘locked’ the required amount of a pilot CBDC on the RBA’s pilot CBDC platform and minted an equivalent amount of wrapped pilot CBDC tokens on Ethereum,” the payment processor wrote.

“A prerequisite of the test transaction was that the Ethereum wallets of both the buyer and seller, as well as the NFT marketplace smart contract, were ‘allow-listed’ within the platform. With all other transfers of the wrapped pilot CBDC blocked, it successfully demonstrated the platform’s ability to implement controls – even on public blockchains.”

The solution uses Mastercard’s Multi Token Network, introduced in June of 2023, combining payment technology with blockchains.

“Together with Mastercard, we have identified a use case whereby digital currencies and NFTs can easily be linked, potentially stamping out fraud and theft, ending the loss of documentation and records, and unleashing new possibilities for commerce,” commented Zack Burcks, CEO and founder of Mintable.

Nathan Churchward, Domain Lead, Payments at Cuscal, stated, “We were pleased to collaborate with Mastercard to test new approaches to managing settlement and liquidity risk through the CBDC pilot. It's exciting to be able to further partner with Mastercard to support the future of banking and payments in Australia.”

The RBA previously stated that an Australian dollar CBDC would potentially enable complex payment arrangements and transformation in the finance sector that can not be replaced by fiat money. Nevertheless, the central bank also pointed out that “more research” is needed to assess the benefits.

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