Philippine Central Bank Targets CBDC Pilot Completion by Year-End
The central bank of the Philippines (BSP) is working towards completing a pilot for its central bank digital currency (CBDC) by the end of the year, according to a local report.
Mamerto Tangonan, Deputy Governor for Payments and Currency Management at the BSP, shared this information during a press briefing. He stated that the pilot project is a “learning exercise” to assess the technology and is being tested with six domestic financial institutions.
Aims of the CBDC Pilot
The BSP has outlined several objectives for its CBDC pilot:
- Complete the pilot project by the end of the year
- Test whether the technology performs as claimed
- Transfer funds among participating financial institutions
- Explore whether CBDC can be used for higher value-adding services like securities settlement
Participating Financial Institutions
The six domestic financial institutions involved in the CBDC pilot are:
- BDO Unibank Inc.
- China Banking Corp.
- Land Bank of the Philippines
- Rizal Commercial Banking Corporation
- Union Bank of the Philippines
- Maya Philippines Inc.
The Philippines in Recent Crypto News
In February, BSP Governor Eli Remolona revealed details about the Philippine CBDC project:
- The CBDC will not be built on a blockchain but on a private payment and settlement system owned by the central bank.
- It will be a wholesale CBDC (wCBDC) available only to licensed intermediaries for use in wholesale transactions.
- The CBDC is designed to complement cash in the financial system.
Additionally, the Philippine National Telecommunications Commission (NTC) has started blocking unlicensed crypto platforms in accordance with a directive from the Securities and Exchange Commission.
While Binance remains accessible for now, the SEC Chairman has stated that the platform will eventually be blocked. The SEC is currently undergoing an internal transition before taking further action.
In a bid to embrace the benefits of crypto technology, the Philippines’ Bureau of the Treasury announced plans last year to issue tokenized Treasury bonds worth at least 10 billion pesos ($180 million) on a blockchain system.
Hot Take: Philippine Central Bank Pushes Forward with CBDC Pilot
The central bank of the Philippines is making significant progress in its CBDC initiative:
- The BSP aims to complete its CBDC pilot by year-end, marking a major milestone in the project’s development.
- The pilot project serves as a learning exercise and involves testing with six domestic financial institutions.
- If successful, the wholesale CBDC could potentially be used for higher value-adding services like securities settlement.
The Philippines has been cautiously exploring cryptocurrencies, with various government agencies and financial institutions actively engaging in blockchain-based projects. This proactive approach demonstrates the country’s commitment to leveraging emerging technologies for financial innovation and inclusion.
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