Chinese Project to Bridge Gap Between CBDCs and Stablecoins

The Capitalization of ETH Exceeds That of Bank of China
  1. A Hong Kong blockchain company has launched a new digital payment method.
  2. This method is anticipated to bridge the gap between stablecoins and CBDCs.
  3. This report does not mention the involved banking organisations.

A blockchain business based in Hong Kong has introduced a new digital payment system with the intention of filling the void that exists between stablecoins and Central Bank Digital Currencies (CBDCs). Amid this, some people are comparing the project to the antiquated SWIFT network. 

Specifically, on January 19, at the meeting of the World Economic Forum (WEF) 2023 in Davos, Switzerland, Red Date Technology, the blockchain infrastructure startup that is also driving one of China’s blockchain efforts, announced the Universal Digital Payment Network (UDPN).

According to a press release that was issued on January 19, “a number of global tier 1 banks” are already participating in use case proof of concepts (POCs) in order to test the network in the context of cross-border transfers and swaps.

The statement did not identify which institutions were participating in the POCs; however, Deutsche Bank, HSBC, Standard Chartered, The Bank of East Asia, and Akbank were all represented on a panel during the unveiling of the UDPN in Davos.

The startup gained prominence as a contributor to China’s national blockchain initiative, Blockchain-based Service Network (BSN), before establishing this digital payments system.

The BSN planned to create a global CBDC system that “will completely change the current payment and circulation method, enabling a standardized digital currency transfer method and payment procedure for any information system,” according to a roadmap posted on January 15, 2021, which has since been removed.

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Godfrey Mwirigi is an enthusiastic crypto writer with an interest in Bitcoin, blockchain, and technical analysis. With a focus on daily market analysis, his research helps traders and investors alike. His particular interest in digital wallets and blockchain aids his audience in their day-to-day endeavors.

programmer & freelance writer