Hong Kong to Use Chainlink’s CCIP for CBDC Research

The Hong Kong authorities is partnering with Chainlink’s Cross-Chain Interoperability Protocol (CCIP) to check cross-border transactions between permissioned and permissionless blockchains, in addition to settlements utilizing various kinds of digital belongings.

The partnership is a part of Section Two of Hong Kong’s central financial institution digital foreign money (CBDC) initiative. In keeping with a report from funds firm Visa, the initiative will contain a hypothetical Australian investor who needs to buy a tokenized asset in Hong Kong.

After requesting the acquisition in a stablecoin pegged to Australia’s foreign money, the transaction can be routed through interactions throughout a number of blockchains. Lastly, the bought asset finds its means into the investor’s pockets, denominated in Hong Kong’s CBDC.

Chainlink’s CCIP performs a job within the communication between totally different blockchains. In keeping with the corporate, CCIP is reside on dozens of blockchains, together with Ethereum Digital Machine-compatible and Solana Digital Machine-compatible blockchains. Within the case of the Hong Kong research, the Ethereum testnet Sepolia can be used.

The important thing companions for the research are Visa, as a expertise supplier, Australia and New Zealand Banking Group (ANZ), and asset managers ChinaAMC and Constancy Worldwide. The research is one among many who the Hong Kong authorities is commissioning to discover use instances for a doable CBDC.

This research focuses on inspecting the interaction between permissioned and permissionless blockchains. Permissioned blockchains are valued for his or her privateness and managed environments, which make it simpler to implement compliance and confirm consumer identities. Permissionless blockchains, against this, supply broad decentralization and open participation, giving them a robust distribution impact.

The Hong Kong Financial Authority (HKMA) began Section Two of the Hong Kong CBDC program on Sept. 23, 2024. Throughout this part, 11 teams of firms will discover use instances for the CBDC, known as e-HKD. The findings from these research are anticipated to be revealed by the tip of 2025.

Associated: What’s a CBDC? Why central banks wish to get into digital currencies

CBDC fever seems to be cooling

In keeping with a February 2025 survey, solely 18% of central banks around the globe are inclined to challenge a central financial institution digital foreign money, in comparison with 38% in 2022, indicating that curiosity in CBDCs could also be cooling.

Nonetheless, some nations and financial blocs are urgent on with their CBDC plans. In March, Israel launched a preliminary design for a digital shekel. In February, the European Union ramped up efforts for CBDC platform growth.

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