The Central Bank of France is racing towards the development of its digital currency. With the institution now set on building test scenarios for the asset, it has announced a new partner in the endeavor. Blockchain development studio ConsenSys has inked a deal to help test the imminent French Central Bank Digital Currency (CBDC).
Wholesale CBDC Applications
According to an official press release, the blockchain studio would work with Société Générale Forge, a digital capital markets platform and a subsidiary of financial services conglomerate Société Générale Group. SG Forge specialized in building institutional-grade models for security token operations, especially with the application of blockchain technology.
SG Forge is one of the top companies partnering with the Banque du France on its digital euro. Earlier this year, it joined forces with the Central Bank and Société Générale SFH to issue a tokenized bond, worth 40 million euros. Explaining the new deal, ConsenSys confirmed that it would provide its technology and expertise for joint CBDC issuance experiments. The experiments will test the digital euro’s management, delivery, and cross-ledger interoperability.
The process is part of extensive tests being carried out by the French Central Bank. Tests began months ago, with the agency selecting other partners, including banking giant HSBC and financial services provider Accenture.
So far, the Bank remains committed to issuing a CBDC that would only work for wholesale purposes. When it announced the first successful test for the asset in May, the agency explained that it would serve institutional players and banks instead of retail operations. It’s unclear whether it plans to issue a separate asset – or, at least, a version of this one – for retail purposes after seeing this one through.
ConsenSys: The Ultimate CBDC Test Partner
Another point of interest will be how the country’s CBDC plans to operate alongside that of the European Union. The European Central Bank (ECB) confirmed that it had opened research into a possible CBDC last month, and there is every indication that such an asset will operate across the continent. A proliferation of CBDCs could cause monetary policy issues, and governments will want to b wary of that.
Despite the possible setbacks, progress like this is encouraging. As for ConsenSys, the blockchain firm continues to spread its roots into the CBDC ecosystem. In January, the Hong Kong Monetary Authority (HKMA) and the Bank of Thailand (BOT) jointly announced Project Inthanon-LionRock, a CBDC and cross-border payment system. ConsenSys eventually got the contract to lead the second phase of implementation for it.
The blockchain studio is also heavily involved in Project Ubin, a CBDC pilot program from the Monetary Association of Singapore (MAS), and Khokha – a tokenized fiat interbank payment system from the South African Central Bank.
With the firm’s CBDC roots spreading, it’s only a matter of time before more countries call it for help.