The Central Bank of Montenegro (CBCG) is collaborating with Ripple to develop a strategy and pilot program for the country’s first Central Bank Digital Currency (CBDC), or national stablecoin.
The collaboration was announced in an April 11 press release. Its aim is to advance the CBCG’s core objectives of digitizing financial services and enhancing financial accessibility for Montenegrin citizens.
CBDCs are digital equivalents of central bank-issued currencies, with over a hundred countries researching their potential benefits. The advantages of adopting CBDCs include expanding financial inclusion, modernizing monetary policy, bolstering payment security, and improving cross-border payment efficiency.
In line with these developments, the European Central Bank is also progressing with the digital euro concept, an initiative to provide a safe, secure, and practical electronic payment method in the euro area.
Radoje Žugić, Governor of the CBCG, stated that the central bank is dedicated to maintaining an efficient financial system and is excited to collaborate with Ripple on the pilot project. This project will explore blockchain technology’s functionality and potential while scrutinizing the possible advantages and risks of CBDCs and national stablecoins.
The pilot program will unfold in several stages, including identifying practical applications of a digital currency or national stablecoin and designing its circulation and use under controlled conditions.
James Wallis, Ripple’s vice president, expressed enthusiasm for assisting the CBCG with launching its first digital currency to address Montenegro’s core financial objectives.