- Norway’s central bank has announced another phase of its CBDC experiment.
- The development comes after the completion of the phase 4 pilot.
- The fifth face will commence at a date to be communicated in due course.
The Central Bank of Norway, Norges Bank, has announced plans to advance its CBDC pilot in a fifth phase, exploring issuance amid evolving global trends.
Norges Bank has been involved in an ongoing research project on CBDC to evaluate whether introducing such money is an “appropriate measure” for ensuring its security, efficiency, and attractiveness for use in payments in NOK and the feature.
Norges Bank Announces the Fifth Phase of CBDC Research
According to a press release dated December 18, Norway’s CBDC research is now entering a fifth phase after completing a fourth phase conducted over the past two years. Phase 4 consisted of experimental testing of technical solutions and reviewing the legislative changes necessary to permit the introduction of CBDC.
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Per the statement, the fifth phase intends to result in a recommendation to Norges Bank’s executive management on whether CBDC should be introduced in the country. If so, the research will inform the bank of the design characteristics that CBDC issuance and usage should follow.
In addition to analyzing the possibilities afforded by and the impact of issuing a CBDC and testing candidate solutions, the fifth phase will research a CBDC intended for general-purpose users and evaluate “new forms of settlement in central bank money that can facilitate innovation in the financial system.”
Norges Bank Governor Ida Wolden Bache noted that the introduction of CBDC is more relevant than ever.
Catching Up with the Future
According to Bache, despite the current payment system in Norway functioning well, the falling cash usage and the emergence of new forms of money and payment platforms and work on CBDCs in other countries warrant the project’s advancement.
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“Norges Bank wants to be prepared to be able to introduce a CBDC if the payment system evolves in a direction where important societal considerations are challenged,” Bache stated.
While no specific dates were mentioned when the fifth phase will commence, the statement noted that the project will maintain contact with stakeholders in the Norwegian payment system, international organizations, and other central banks.
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