Norway Launches CBDC on Ethereum
On Monday, Norway’s central bank deployed its Central Bank Digital Currency (CBDC) prototype on the Ethereum network. Currently in a test phase, the open source code was released on GitHub and enables minting, burning, and transferring of ERC-20 tokens.
CBDC prototype launched
Norges Bank has been testing plausible CBDC designs since April 2021. Since then, it has partnered with Nahmii, an Ethereum development enterprise, to create the digital currency. On Friday, Norges Bank took to Twitter to announce the launch. By way of translation, the bank stated:
“As part of our experimental testing of #DSP, @Nahmii_io has now developed a prototype infrastructure based on #Ethereum technology. Some actors are already involved in the testing, but we hope more will join!”
Features and testing
The central bank chose Ethereum for the buildout because its “core infrastructure” best addressed interoperability, the bank’s biggest concern. The bank needed an infrastructure that could handle the large amounts of issuance, distribution, and destruction of digital central bank money (referred to as DSP).
Nahmii stated in a blog post that it has produced a new frontend platform that gives users a “clear and intuitive interface” to test the system.
The Norges Bank CBDC does not currently support the MetaMask wallet; only users with certain credentials can use the platform. All transactions on the sandbox design are private.
CBDCs are growing
Many consider Finland's Smart Card, released in 1993, to be the world’s first CBDC. Since the advent of Bitcoin in 2009 and Ethereum in 2014, digital currency has become much more plausible.
A recent report from the International Monetary Fund has found that as of July 2022, 97 countries – more than half of all central banks – have explored using CBDCs. 11 countries have CBDCs in operation, including Nigeria, Jamaica, and The Bahamas.
