Italian Banking Association Rolls Out Digital Euro Pilot; Testing For Technical Feasibility
Crypto News

Italian Banking Association Rolls Out Digital Euro Pilot; Testing For Technical Feasibility


The Italian Banking Association (ABI) will conduct digital euro tests to evaluate the technical feasibility of a blockchain-based digital currency.

The project will utilize the Spunta Interbank Network, which already has 100 nodes spread across the country.

The association members of ABI are from over 700 financial institutions in Italy. The associated stated that the idea is to measure the hypothetical issuance of a digital euro.

The project will determine the role of banking institutions when the digital asset industry fully takes shape in the future. The European Central Bank (ECB) has been preoccupied with Brexit, which has delayed the launch of the proposed European digital currency. However, the union has intensified efforts, and the Italian banking association wants to see the feasibility of that project on the future of the banking sector.

The association noted recently in a press release that it is working with ABI Lab, the association’s research and development unit.

The project will explore the technical feasibility of CBDC

It also will explore, “new value-added services that will be possible thanks to the programmability of the currency.” The digital euro study will hope to achieve two things – CBDC programmability, and technical feasibility analysis. The CBDC programmability study is to establish a distinction between the CBDC and the existing electronic payment method.

For the technical feasibility studies, Italian enterprise network firm SIA has been called to offer technical and expert assistance. The firm also doubles as a Spunta project collaborator, the blockchain-based interbank settlement platform for ABI.

Although the project will be centered on the issuance of experimental digital euro or a CBDC, there is no mention of the Banca d’Italia participation during the announcement.

But it mentioned other partners to the project, such as business consulting giant PwC and digital services firm REPLY. Both firms have provided their technical and human resources to the project.

Preparing Italian banks ahead of digital evolution

As ABI has noted, the project is an effort to prepare Italian banks ahead of the digitalized currency framework that will be sweeping all over the financial sector. The future could also include a digital euro, and the ABI has thought it wise to get its member associations fully ready.

A spokesperson of ABI commented on the project, saying the main goal of the project is to offer support to Italian banks that are not sure how to deal with the changes coming with digital currency.

The project will be very useful to support banks that are preparing for the future with digital currencies. The spokesperson stated that the aim is not to anticipate the introduction of the euro digital currency but to explore best use case scenarios.

Last month, an ECB official stated that the consideration phase of the project could expand even beyond 2021. And as previously reported, it could take more than five years before the euro central bank digital currency is developed.

But in France, its central bank has started test-running several protocols before the launch of the experimental digital euro.



Source link