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International payments provider Mastercard has launched a virtual testing environment to help central banks around the world test their Central Bank Digital Currencies (CBDCs), said an announcement today.
“Today, Mastercard announced a proprietary virtual testing environment for central banks to evaluate CBDC use cases. The platform enables the simulation of issuance, distribution and exchange of CBDCs between banks, financial service providers and consumers,” said the company.
According to the announcement, the effort would allow banks to test whether CBDCs fit them and are feasible to be issued—locally or regionally.
“The virtual platform can be individually customized to the environment in which the central bank operates, allowing them to [...] simulate a CBDC issuance, distribution and exchange ecosystem with banks and consumers, including how a CBDC can interface with existing payment networks and infrastructures – e.g., cards and real time payments,” said the announcement.
The project also aims to demonstrate how a central bank digital currency could be used in everyday life and what forms of it are feasible in the current market.
“Central banks have accelerated their exploration of digital currencies with a variety of objectives, from fostering financial inclusion to modernizing the payments ecosystem," said Raj Dhamodharan, executive vice president of digital asset and blockchain products and partnerships at Mastercard.
As Decrypt reported, Mastercard’s competitor Visa has laid out its platform-agnostic approach to crypto and blockchain recently. Is it time for the big payments companies to cement their places in the crypto industry?