Turkey’s Central Bank Commences First CBDC Pilot Test

• Research into the economic and legal framework of the CBDC will be prioritized.
• The central bank hopes to add additional banks and fintech companies.

Central Bank digital currencies (CBDC) are central bank-issued digital tokens that function similarly to cryptocurrencies. They correspond in value to the national fiat currency of the nation. CBDCs are the subject of much research and development, with several nations having already adopted them.

On Thursday, the Turkish Central Bank stated that the first payment transactions utilizing the Digital Turkish Lira Network had been performed successfully. As part of the first round of testing. The Turkish CBDC’s “limited, closed-circuit pilot tests” will continue. Throughout the first three months of 2023, according to the central bank’s announcement.

Extended Research Would Be Prioritized

The bank said in a statement that it would continue to conduct validation testing for acceptable architectural configurations. In areas like the use of distributed ledger technologies in payment systems. And the integration of these technologies with instant payment systems.

Furthermore, the central bank hopes to add additional banks and fintech companies to the Digital Turkish Lira Collaboration Platform. As the central bank makes public more detailed information about the current pilot study.

The Turkish central bank also said that for all of 2023. Research into the economic and legal framework of the Digital Turkish Lira, as well as its technical needs, would be prioritized.

The Federal Reserve Board of the United States released a paper earlier this year that extensively examined the pros and cons of CBDCs. However, the European Central Bank is also looking for ways to integrate distributed ledger technology with its current payment settlement infrastructure.

Moreover, other nations with the intention of adopting digital currencies supported by their central banks include Kazakhstan, Japan, Indonesia, and India.