Central Banks of UAE and Saudi Arabia Released a Joint Report on CBDC

A joint report published by the central banks of UAE and Saudi Arabia, two countries with the most powerful economy in the Middle-eastern region, shows the most promising CBDC research. 

The results are promising for blockchain technology according to the report. This project, known as Aber was first announced in January 2019. Through this project, UAE and Saudi Arabia will join hands to develop a proof of concept. This is developed to play its part in the information related to CBDC and DLT technology. 

This joint effort of the two central banks is done for the first time. The name Aber is chosen as it represents the core of the project: “The name Aber was selected because, as the Arabic word, for “crossing boundaries”, it both captures the cross-border nature of the project as well as our hope that it would also cross boundaries in terms of the use of the technology.”

The report highlights that CBDC is an important improvement over a centralized payments system and it not only viable for cross-border payments. The project cleared that, “The key requirements […] were all met, including complex requirements around privacy and decentralization, as well as requirements related to mitigating economics risks, such as central bank visibility of money supply and traceability of issued currency.” 

The report also laid out the next steps the study will take which includes the adoption of DLT to enhance the security of the system and amplifying the scope of project Aber by including more partners from around the world along with other asset settlement like bonds.