Qatar Central Bank (QCB) has successfully completed the development of its infrastructure for the central bank digital currency (CBDC). In an announcement on Sunday, the national bank revealed its plans to test large payment settlements using advanced technologies and collaborate with local and international banks for further testing and development.
According to the bank, the CBDC will make use of emerging technologies such as artificial intelligence (AI) and distributed ledger technology (DLT). This move is in line with Qatar’s Third Financial Sector Strategic Plan, which was issued by the central bank in 2023 and includes a Fintech Strategy as part of Qatar National Vision 2030.
Cryptonews spoke to Sheetal R Bhardwaj, a Dubai-based Risk & Compliance professional and certified crypto investigator (CCI), to gain insight into Qatar’s strategic move in developing its CBDC infrastructure. Bhardwaj explained that the development of the CBDC infrastructure aligns with the goals of Qatar’s National Fintech Strategy by improving the performance and safety of the payment system, increasing financial inclusion and access, encouraging innovation and competition, and enabling international cooperation and integration.
Regarding the involvement of banks in the testing and development of Qatar’s CBDC for large payment settlements, several local and international banks have been invited to participate. These include Qatar National Bank (QNB), which has been testing the use of CBDC for cross-border payments and trade finance, the Commercial Bank of Qatar (CBQ), which has been testing the use of CBDC for domestic payments and remittances, Qatar Islamic Bank, HSBC Qatar, and Standard Chartered Qatar.
As for the role of emerging technologies like AI and DLT in the development of Qatar Central Bank’s CBDC, AI can be utilized for fraud detection and prevention, as well as data analysis to enhance the efficiency and security of the CBDC system. DLT, particularly blockchain technology, provides a secure and transparent foundation for recording transactions, ensuring their immutability and traceability. It allows for the decentralized and tamper-proof issuance, distribution, and management of the CBDC.
With the launch of the CBDC infrastructure, regulatory changes can be expected in the near future. These changes will address issues such as digital identity verification, data protection, cybersecurity, and anti-money laundering measures. The aim is to ensure the reliability, compliance, and security of the CBDC, including the privacy and financial security of its users.
