A wholesale CBDC may efficiently work with personal stablecoins, reveals analysis from the Hong Kong Financial Authority and BIS Innovation Hub.
Then they investigated a retail e-wallet system through which the retail CBDC circulates amongst customers – however with two forms of tokens: an intermediated CBDC, or CBDC-tokens; and CBDC-backed stablecoins.
The researchers used UTXO (Unspent Transaction Output) to allow the traceability of the tokens to the backing belongings, offering security to end-users even when a business financial institution goes bust.
Itemizing the advantages of the arrange, the paper says that the two-tier structure offers extra privateness for the end-users because the interbank system doesn’t report any private information. In the meantime, the decoupling of the wholesale and e-wallet techniques strengthens the cyber resilience primarily based on the precept of privilege separation and community segmentation.
The authors say “now we have little doubt that the Aurum prototype will catalyse and encourage the worldwide quest for essentially the most appropriate rCBDC structure”.
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