There’s been considerable work on the concept of using wholesale (interbank) central bank digital currencies (CBDC) to address the frictions of cross border payments. So far, only one project has taken the alternative route of interlinking multiple retail domestic CBDCs to enable consumers or businesses to make direct person-to-person international payments.
To do just that, the Bank of Israel is working with the central banks of Norway and Sweden and the Nordic BIS Innovation Hub on Project Icebreaker, as announced in September last year.
Talking at a panel at the World Economic Forum event in Davos, the Governor of the Bank of Israel, Amir Yaron, said that Project Icebreaker enables near instant cross border payments without intermediaries. It uses a central hub developed by the Bank of Israel to interlink domestic CBDC systems with minimal adaptations required.
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