Days after Do Kwon, the founder of Terra Labs, was arrested for fraud, Montenegro announced its intention to develop a central bank digital currency (CBDC) in partnership With Ripple, which is a blockchain company.
Montenegro partners with Ripple for CBDCs
Montenegro has expressed interest in digital currencies and has approached Ripple to develop a pilot program and strategy for a national digital currency or stablecoin for the Central Bank of Montenegro (CBCG).
According to the Governor of Montenegro, Radoje Žugić, their collaboration with Ripple aims to create a safe and functional digital currency to test the functionality and capabilities of the blockchain. It will also analyze the advantages and risks that digital central banks can pose to the availability, security and efficiency of electronic means of payment while ensuring their compliance with regulations. More importantly, Zojek said, the CBD will protect citizens’ rights and privacy.
Their partnership with Ripple to develop Montenegro’s first digital currency is a step towards financial inclusion and accessibility for its citizens.
Ripple was in forefront CBDC development In the last years. The blockchain company wants to connect disparate payment systems and help blockchain develop CBDCs as it also solves global payment problems.
Ripple’s Vice President of Central Bank Operations and Central Bank Digital Currency James Wallis said their partnership with Montenegro will help the country address its core fiscal goals.
Ripple has a proven track record of successfully connecting disparate payment systems and championing the utility of blockchain to issue central bank digital currencies and solving global payments for hundreds of financial institutions around the world. We are delighted that CBCG has chosen Ripple to help launch its first digital currency and continue to address the country’s core financial goals.
Do Kwon is arrested
The announcement comes days after Arrest Do Kwon, founder of Terraform Labs, wanted in the US and South Korea for fraud and financial crimes related to the collapse of Terraform Labs’ coins, including LUNA and UST, an algorithmic stablecoin.
The development of central bank digital currencies, which are different from privately issued stablecoins such as the collapsing UST or USDT, is gaining momentum globally. CBDCs are backed by the government and can be issued on a private network.
CBDCs have many use cases, including expanding financial inclusion, modernizing monetary policy, improving payment security, and increasing the efficiency of cross-border payments. However, CBDCs have been criticized as potential tools that governments can use to censor opponents and invade privacy.
The European Central Bank (ECB). developing The concept of the digital euro as a future means of safe, secure and practical electronic payment in the euro area.
Featured image from Canva, chart from TradingView
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