Montenegro to develop CBDC pilot in association with Ripple

• Montenegro central bank has chosen Ripple to build a pilot program for CBDC.
• Notably, over 100 countries are investigating the feasibility of issuing a CBDC. 

The Montenegro central bank has inked a deal with Ripple, the blockchain firm based in San Francisco, to build a pilot program for the national central bank digital currency (CBDC).

The central bank will find practical applications for a CBDC and create a design to simulate its circulation.

In a statement, Central Bank of Montenegro Governor Radoje Zugic stated that the project will examine the benefits and risks that CBDCs or national stablecoins may pose in terms of electronic payment availability, security, efficiency, regulatory compliance, and, most importantly, the protection of end users’ rights and privacy.

Despite not being a member of the Eurozone, the country has used the Euro as its currency since its introduction in 2002.

Montenegrin Prime Minister Dritan Abazovic announced the forthcoming cooperation between Ripple and the central bank in January this year at the World Economic Forum Davos.

Over 100 countries are investigating the feasibility of issuing a CBDC. The European Central Bank and the European Union will decide whether to launch a digital euro later this year.

Ripple traversing the CBDC space across countries

Ripple has been discussing CBDCs with approximately 20 central banks over the last few years. Ripple is a technical and research partner in a number of important CBDC programs throughout the world. It has recently begun partnering with several digital Euro, digital Pound, and other initiatives.

Ripple is also supposed to reveal private distributed ledger systems for CBDCs that are based on the XRP Ledger blockchain design.

Earlier this week, it was announced that Ripple became the first platinum partner of the Digital Monetary Institute Symposium 2023.

However, Ripple’s future is uncertain as the crypto firm is still locked in a legal dispute with the SEC over the issuing of XRP currencies.

Following the announcement, the price of XRP, Ripple’s native cryptocurrency, on 11 April, rose sharply by 5% to $0.526. However, it quickly descended again. The coin was trading at $0.507 at press time.