The Qatar Central Bank (QCB) has announced the completion of infrastructure development for its Central Bank Digital Currency (CBDC) project, marking a significant milestone in its digital financial transformation efforts.

In a press release on June 2, QCB disclosed the commencement of the initial phase of its CBDC project, scheduled to run until October. The central bank stated that this initiative aligns with global advancements in digital currencies and aims to modernize and strengthen Qatar’s financial sector.

In this first phase, following an extensive study, the bank will proceed to test and develop selected applications of the CBDC for large payment settlements with local and international banks within a cutting-edge trial environment.

The primary objectives of the CBDC project include enhancing domestic banks’ access to capital markets, improving local settlement processes, and optimizing the efficiency of securities transactions. The experimental phase is set to conclude by October.

The project will utilize artificial intelligence (AI), distributed ledger technology (DLT), and other emerging technologies to boost liquidity by expanding participation in financial market infrastructures while prioritizing robust security measures.

QCB underscored that maintaining information security throughout the project implementation remains a top priority.

Digital Transformation

The CBDC project aligns with Qatar’s Third Financial Sector Strategy, Fintech Strategy, and Qatar National Vision 2030, representing a strategic move towards fostering a digital economy and demonstrating QCB’s commitment to digital transformation in the financial sector.

According to the press release:

“Qatar Central Bank is keen to keep pace with the digital transformations witnessed by the financial and banking sector both regionally and globally.”

QCB emphasized its continuous efforts to regulate and develop the financial sector, highlighting the potential of the CBDC project to enhance liquidity by broadening participation in financial market infrastructures.

The central bank reiterated its commitment to creating an environment conducive to financial sector growth and promoting technological innovation.

The outcomes of this initial experimental phase will serve as the basis for identifying various CBDC use cases, aiming to enhance the efficiency of current systems and enable instant settlement capabilities.