South African Reserve Bank Starts Its CBDC Retail Feasibility Study

The South African central bank said in a statement released on May 25 that its CBDC feasibility study would include potential implementation of the new currency on various growing technological platforms.

 It further added that the study would consider several factors around the digital currency, including regulation, security, policy, and most importantly, risk management.

Yet, the statement also clarified that the new study would be quite different from the previous one. It added, 

It should be noted that while the CBDC feasibility study is different from Project Khokha, which focuses on the settlement of high-value transactions between commercial banks and other stakeholders at the wholesale level, it is expected that the two studies will result in better policy alignment and coordination.

Although the bank clarified that it has no intention to launch its CBDC any time soon and has made no decision on its digital currency policy, the South African Reserve Bank statement comes three years after it created a project to access the scale, performance, and security of transactions on the Ethereum blockchain.

Interestingly, the stimulation project exceeded its target in only two hours, with more than 70,000 transactions. In addition to that, in less than one second, the experiment received 95 percent block propagation and 99 percent in two seconds.

Despite the geographical distribution of banks’ hardware, the extraordinary results suggest that acceptable performance is achievable.

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