National Bank of Ukraine (NBU) recently hosted one day conference wherein representatives of the number of central banks shared their ideas for Central Bank Digital Currency (CBDC) 

The conference was hosted last week in Kyiv, Ukraine. Although the world’s central banks are striving to find the best possible alternative to digital currency and thus examining CBDC, the event showed a different viewpoint. Although, NBU is working on a pilot project of its CBDC since 2016, yet, the reports note that the world’s central banks view blockchain is unnecessary for digital fiat. 

The event featured speakers or representatives of central banks from Japan, Canada, Finland, Belarus, Lithuania, Netherlands, South Africa, and Uruguay. While these countries are weighing blockchain’s involvement in developing digital fiat, countries like China, Germany and the USA are ahead of the game. Noticeably, China is the leading name among the top bulletins as it is developing national digital currency for quite long. 

While NBU is working on developing a state-backed cryptocurrency, dubbed “e-hryvnia”, the test reveals that;

“There are no fundamental advantages in using specifically the DLT [distributed ledger technology] to build a centralized e-hryvnia issuance system”...( since NBU is the only issuer).

However, it also laid out that the central banks are not managing or controlling an alternative “decentralized model”. More so, the report added that the pilot testing of e-hryvnia ran with the help of AtticLab, finance companies Uapay and OMP 2013 and Deloitte as an auditor. It was also revealed that the testing followed between September to December 2018 with a limited set of participants in place. 

Discussing during the event, Harry Boven who is the policy advisor in the payments policy department of the Dutch central bank says:

"The essence of the DLT infrastructure is that no single party should be trusted enough, but don’t we just trust a central bank to maintain the integrity of the global ledger?"

A similar thought was also reiterated by the senior special director of fintech at Bank of Canada, Scott Hendry. In his view, banks “don’t need a DLT to make a central bank digital currency”. 

“There doesn’t see to be a lot of benefits if you look at a DLT system and the current efficient centralized system for the sole purpose of interbank payments,”