The Stellar Development Foundation (SDF) has been working with the Ukrainian government on their national Central Bank Digital Currency (CBDC) for a while. The collaboration has started to produce results as the SDF, Bitt, and TASCOMBANK recently deployed a pilot project for the electronic hryvnia on this network.
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Per a press release, the partners will test the CBDC’s use cases and its programmable capabilities. These will be leveraged to pay employees at a company called Diia, and to perform payments to merchants and individuals.
According to the release published by Bitt, the project has been under the supervision of the National Bank of Ukraine aided by their Ministry of Digital Transformation. In that sense, Ukraine’s Deputy Minister of Digital Transformation, Oleksandr Bornyakov commented the following on their CBDC’s test phase:
This pilot project will serve as a technological basis for the issuance of electronic money and is the next key step to advance innovation of payment and financial infrastructure in Ukraine.
During the trial on Stellar, the partners will also test the capacity to issue digital currency with “asset-control capabilities for issue”s”. The banking institution will be in charge of testing the implementation of the hryvnia on Bitt’s Digital Currency Management System (DCMS).
The latter company has been in charge of developing a stablecoin with its payment rails for the National Bank of Belize, and it’s behind the Eastern Caribbean Central Bank (ECCB) initiative to launch a CBDC. The target for this project, per its official website, is to increase “opportunities for financial growth”.
Similar to this project, the digital hryvnia will use the “moderns software techniques” and alleged scalable and performant benefits from the DCMS. This system will “protect” the user’s data while regulatory bodies still can access “needed” information, the official website adds the following on their DCMS:
Security is designed-in, to use secure defaults, minimize attack surfaces and provide defense-in-depth. Independent modules allow each component to scale independently of others, allowing automatic adjustment to meet variable demands.
Stellar Spearheads Ukranian Initiative
With its DCMS system Bitt will provide secure minting, currency manager, and a monetary transaction network. Thus, tackling three of the most important items in every CBDC project. Volodymyr Dubey, Chairman of the for TASCOMBANK, said:
Cooperation with Bitt to build on Stellar allows us to connect our core banking system with blockchain-based infrastructure, creating an ecosystem that includes a full range of banking products and operations with electronic currency on the Stellar blockchain.
Dubey also expressed excitement to improve the country’s financial products by using virtual assets. The Ukranian Central Bank and TASCOMBANK have long-term strategies that include innovation supported on blockchain technology and the digital economy.
Executive Director and CEO of the Stellar Development Foundation Denelle Dixon added the following:
Stellar is an open network that was designed with asset issuance in mind, and is uniquely suited to assets like the electronic hryvnia. It offers issuers, like TASCOMBANK, a suite of controls that they can configure for their asset control needs while maintaining the interoperability and flexibility of an open ledger.
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As of press time, XLM trades at $0,26 with a 2.9% loss in the past 24 hours.