The institution has clarified that this new program is unrelated to the ongoing investigation into a possible digital euro, and is intended to examine the real possibilities and benefits of using a CBDC in the field.
The Bank of Spain to experiment with its own CBDC
The Bank of Spain recently revealed that it will launch its own experimental program with a wholesale CBDC. A document published at the address on December 5 announces this digital token program, and explains that the institution is seeking the collaboration of companies in the sector, which will be able to formulate their proposals on the subject.
The institution clarifies that this program has no relation to the ongoing efforts of the European Union on the research of the digital euro. The objective of this new program is to determine the feasibility of using such a currency and to test the benefits it could bring to the settlement process.
These proposals will be received by the bank until January 31, at which time the bank will begin evaluating each proposal for possible selection. Selected proposals will be required to be executed within a period not to exceed nine months, beginning April 3, and are scheduled for completion by December 29, 2023. However, the bank may grant additional time based on several factors, depending on the selection process.
While most of the experiments and trials carried out today in the field of CBDC are focused on the figure of a currency with universal vocation, the Bank of Spain is also interested in a wholesale currency, intended to facilitate the settlement of financial transactions between banking institutions.
The program defined in the public document that describes the experiments gives three key tasks that must be accomplished: the simulation of transactions using wholesale CBDC, the experimentation of the combination of CBDC and liquidation of financial assets, and the analysis of possible advantages and disadvantages derived from the implementation of a wholesale CBDC compared to traditional methods.
The institution did not offer further details on the future of a hypothetical wholesale currency in Spain, or on the intention to implement a similar currency for interbank transactions.