April 19, 2024
Mastercard partnering with RBA
Latest Cryptocurrency News

Mastercard and RBA Collaborate to Enable CBDC-NFT Transactions on Ethereum

Mastercard has successfully concluded a trial that involved the integration of central bank digital currencies (CBDCs) into various blockchain networks, similar to the concept of wrapped Bitcoin (wBTC) and wrapped Ether (wETH).

As per the announcement made on October 12, the trial was executed in collaboration with the Reserve Bank of Australia (RBA) and the country’s Digital Finance Cooperative Research Centre, CBDC, with participation from Cuscal and Mintable. In a live operational setting, Mastercard disclosed that their solution enabled a CBDC holder to purchase a nonfungible token (NFT) listed on the Ethereum blockchain. The payment processor explained that the process locked the required amount of a pilot CBDC on the RBA’s pilot CBDC platform and minted an equivalent amount of wrapped pilot CBDC tokens on Ethereum.

A prerequisite for the test transaction was that the Ethereum wallets of both the buyer and seller and the NFT marketplace smart contract were allowed within the platform. While all other transfers of the wrapped pilot CBDC were blocked, this test successfully showcased the platform’s capacity to implement controls, even on public blockchains. This innovative solution leverages Mastercard’s Multi-Token Network, which was introduced in June 2023, and seamlessly integrates payment technology with blockchain technology.

Zack Burcks, CEO and founder of Mintable, expressed his thoughts on the development, stating that together with Mastercard, they have identified a use case whereby digital currencies and NFTs can easily be linked, potentially reducing the risk of fraud and theft, eliminating the loss of documentation and records, and opening up new possibilities for commerce. Previously, the RBA had indicated that the introduction of an Australian dollar CBDC could potentially facilitate complex payment arrangements and foster innovation in the financial sector that cannot be replicated by traditional fiat currencies. Nevertheless, the central bank also acknowledged that further research is needed to assess the potential benefits.

Image by freepik

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