Mastercard demonstrates CBDC interoperability for Web3 commerce

Thursday 12 October 2023 14:28 CET | News

Global payments technology company Mastercard has revealed that it demonstrated CBDC interoperability for trusted Web3 commerce in Australia. 


According to the official press release, Mastercard has successfully showcased the capabilities of a new solution that facilitates the tokenization (or the wrapping) of CBDCs onto blockchains. The new offering is expected to provide customers with a way to participate in commerce across multiple blockchains. 

The new solution was developed in partnership with Cuscal and Mintable as part of Mastercard’s participation in the Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Centre’s (DFCRC) central bank digital currency (CBDC) pilot project, which set out to explore the potential use cases for a CBDC in Australia.

According to the official statement, the new offering encompasses controls that ensure that the pilot CBDC can be held, used, and redeemed exclusively by authorised parties that have undergone Know Your Customer (KYC) verification and risk assessed by licenced service providers.

Representatives from Mastercard stated that this development comes to address the customer demand for participating in commerce across multiple blockchains. They further added that the new technology is anticipated to drive consumer choice and unlock opportunities to collaborate between public and private networks.

Mastercard has purportedly demonstrated CBDC interoperability for Web3 commerce in Australia and beyond.


More details about the new technology

In a live environment, Mastercard reportedly demonstrated how the new solution can enable the holder of a CBDC to buy an NFT listed on the Ethereum public blockchain. The process involved the ‘locking’ of the required amount of a pilot CBDC on the RBA’s pilot CBDC platform and then the minting of an equivalent amount of wrapped pilot CBDC tokens on Ethereum.

A necessary condition of the test transaction was that the Ethereum wallets of the buyer and seller, and the NFT marketplace smart contract, were ‘allow-listed’ on the platform. Consequently, the test showcased the platform’s capacity to impose controls, even when operating on public blockchains. 

To conduct the test, Mastercard reportedly leveraged two pillars of its Multi-Token Network, a product through which the payment technology company seeks to expand the use of blockchain technology across several payment use cases.

Earlier in 2023, Mastercard announced that it selected blockchain technology company Fluency as its CBDC partner, in a joint effort to capitalise on the growing interest in digital currencies.

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Keywords: partnership, cryptocurrency, paytech, fintech, tokenization, KYC, NFT, transactions , blockchain, Web 3.0
Categories: DeFi & Crypto & Web3
Companies: Mastercard
Countries: Australia
This article is part of category

DeFi & Crypto & Web3


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