The experiment demonstrated that CBDCs could be wrapped to purchase NFTs on blockchains such as Ethereum.
Mastercard has completed a trial involving wrapping central bank digital currencies (CBDCs) on different blockchains, similar to wrapped Bitcoin (wBTC) and wrapped Ether (wETH).
According to the October 12 announcement, the trial was conducted with the Reserve Bank of Australia (RBA) and the country's Digital Finance Cooperative Research Centre CBDC, along with participation from Cuscal and Mintable. In a live environment, Mastercard said the solution allowed a CBDC owner to purchase a nonfungible token (NFT) listed on Ethereum. "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," the payment processor wrote.
"A pre-requisite of the test transaction was that the Ethereum wallets of both the buyer and seller, as well as the NFT marketplace smart contract, were ‘allow-listed’ within the platform. With all other transfers of the wrapped pilot CBDC blocked, it successfully demonstrated the platform’s ability to implement controls – even on public blockchains."
The solution utilizes Mastercard's Multi Token Network, introduced in June 2023, integrating payment technology with blockchains. "Together with Mastercard, we have identified a use case whereby digital currencies and NFTs can easily be linked, potentially stamping out fraud and theft, ending the loss of documentation and records, and unleashing new possibilities for commerce," commented Zack Burcks, CEO and founder of Mintable.
The RBA previously stated that an Australian dollar CBDC would potentially enable complex payment arrangements and innovation in the finance sector that can not be substituted by fiat money. However, the central bank also noted that "more research" is required to evaluate the benefits.
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