Ripple to Supervise Montenegro CBDC Initiative, Says Central Bank

Central Bank Digital Currency (CBDC) is gradually taking its stronghold. 

Financial authorities across many countries are constantly looking for opportunities to bolster economic growth by leveraging emerging financial tools. 

Montenegro is reportedly stepping ahead towards developing a native digital currency, and Ripple will support the initiative. 

On Monday, April 11, the Central Bank of Montenegro (CBGC) announced an agreement with the payment protocol firm Ripple Labs. The company will be responsible for developing a strategy for a digital currency in the Southeastern European country and running a CBDC pilot program. 

The press release noted, “aligning with the CBCG’s core objectives, the digital currency’s introduction is another step forward to digitizing financial services and fostering a world of greater financial accessibility for Montenegro’s citizens.”

Though Montenegro is not officially part of the European Union or Eurozone, it has used Euro as its native currency since 2022. 

Radoje Žugić, Governor of Montenegro Central Bank, stated that the Central Bank would likely work with the government and academic community to look for CBDC development. He added the bank would analyze if the digital currencies, or “national stablecoins,” brings advantages and risks. It will look for the efficacies of digital currency on the “electronic means of payment, security, efficiency, regulatory compliance, and protection of users’ rights and privacy.” 

Vice President for Central Bank engagements and CBDCs at RippleX, James Wallis, highlighted that more details about the project would likely be revealed in the upcoming months. The multi-stage project will be looking to identify digital currency’s “practical application.” The CBDC project is expected to start this month, he added. 

Wallis stated, “The Central Bank of Montenegro is bringing the next level of digital transformation to its financial infrastructure and addressing some of the world’s biggest financial challenges, including financial inclusion.” 

Ripple has boasted of its partnerships with countries regarding multiple CBDC development programs in the funnel. The deal with CBGC is reportedly among the list of multiple deals lined up and at the dialogue stage with many central banks. 

The plan was first teased in January this year when Prime Minister of Montenegro, Dritan Abazovic, brought the information about the deal into the limelight. While attending the World Economic Forum Davos, he revealed the partnership between Montenegrin Central Bank and enterprise crypto and blockchain solutions provider Ripple. 

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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