Today the South African Reserve Bank (SARB) announced the results of its second wholesale or interbank central bank digital currency (CBDC) trial, Project Khokha 2, which commenced in February 2021. The Proof of Concept involved the issuance of both a wholesale CBDC (wCBDC) and a commercial bank money stablecoin (wToken) backed by central bank deposits, creating a synthetic CBDC.
The central bank also participated in the recent multi CBDC trial, Project Dunbar, alongside the central banks of Singapore, Malaysia and Australia.
In the words of SARB governor Lesetja Kganyago, the goal of the Khokha 2 project was to test ‘fit-for-purpose’ money for the settlement of tokenized digital assets, in this case, a government bond security token. A wholesale CBDC enables riskless payment, which combined with a tokenized security and delivery versus payment, reduces market risk.
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