As blockchain technologies reach widespread adoption, one of the most important forms of validation a project can receive is to be chosen by banks and government agencies to develop dApps and platforms to public use.
That is why Fantom’s announcement That it signed a memorandum of understanding with OJSC Orienbank – one of the oldest and largest banks in Tajikistan – to demonstrate a CBDC solution for the Republic of Tajikistan is so monumental.
This landmark deal places Fantom in a highly selected group of blockchain protocols chosen to create a CBDC for a national government. Fantom has long been working on a viable CBDC platform, and by demonstrating its capabilities in Tajikistan, the hope is that doors will open for similar work with other central banks.
CBDCs have been a hot topic in the media. The simultaneous evolution of blockchain technologies, the ever-increasing use of smart devices and the popularity of FinTech call for digital currency and a radical change in the way we think about money.
Working in concert with the government of Tajikistan, Fantom and Orienbank appear poised to turn Tajikistani Somoni into a first currency cross with the blockchain-based CBDC. This transition will move the country’s financial infrastructure into the modern digital economy.
Fantom’s low-cost, high-speed digital ledger technologies will be used to create retail and commercial payment networks. The integration of Andre Cronje’s Iron Bank protocol will also allow transparent foreign exchange transactions with simple access and exit ramps.
After the first tests, the project majors will seek a national deployment of a solution that will automate and optimize financial activity at all levels, from the work of banking administration to the daily activity of consumers.
The Fantom platform will, for example, play a major role in expanding financial inclusion and supporting local commerce. The CBDC Fantom The mobile phone app will allow unbanked users to access digital accounts that they can use to make C2B or P2P payments or even access financial services like microloans.
Many households in Tajikistan depend on remittances, the costs of which remain extraordinarily high (and well above what the UN has set as a sustainable development goal). By eliminating middlemen and reducing transaction costs, Fantom CBDC dramatically reduces transfer costs, saving time and money for the people who use them.
For businesses, the Fantom solution can automate the collection of value-added tax and on goods and services, reducing paperwork and speeding up payment settlement. Even higher in the economic chain, Fantom CBDC increases the resilience of payment networks and preserves monetary sovereignty. The CBDC solution will first undergo a period of testing and refinement. After the first trials, Orienbank and Fantom will look to roll out the product nationwide under Tajikistan’s sandbox regulations.
This agreement is yet another confirmation of the global recognition Fantom is gaining as a provider of next-generation blockchain technologies suitable for real-world use cases.
Above all, this is the latest sign that the future of our globally interconnected society is based on blockchain.