Bank of Hong Kong and Israel Are Collaborating to Test CBDC Cyber Risk

Collaboration Between Bank of Hong Kong and Israel Over CBDC
Digital Ambitions

Bank of Hong Kong and Israel announced their collaboration with BIS Innovation Lab to examine the viability of a CBDC for the general public. The Bank of Israel says that the trial will be for CBDC cyber risk. In the suggested structure, the middlemen have no investment risk from clients with CBDC. It is expected to lower the risk and costs for the financial institutions involved.

Collaboration Between Bank of Hong Kong and Israel Over CBDC

The Bank of Israel is collaborating with the Hong Kong Monetary Authority on trial. According to the bank, the trial will check new digital money. It will include its ability to withstand cyber security threats. The collaborative project will need a 2-tier CBDC. It'll be starting in Q3 2022, according to the release. The Central Bank would be issuing the currency. They will later issue the currency through financial institutions such as banks. Israel is slowly but steadily returning to the concept of a CBDC. That's after it abandoned its first attempt in 2018 when the Central Bank-appointed committee advised against making shekel's digital form.

Digital Ambitions

Some experts think banks may develop their virtual currencies so that they can maintain the same level of control over decentralized currencies as fiat currencies. On testing the retail CBDC, Hong Kong and Israel are looking to see if the middlemen can handle it. They don't want their clients to get exposed to any financial risk. The Bank of Israel believes the exposure-free CBDC will reduce consumer investment risk. It will also have more liquidity, cheaper costs, improved competition, and greater access. Research into cryptocurrencies is still in its early stages. The IMF estimates that over 100 nations have implemented or are contemplating CBDCs. China is one of them.

Disclaimer: The views and opinions expressed in this article are for informational purposes only and do not constitute financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.

Hong Kong monetary Authority Bank of Israel Bank of Hong Kong BIS Innovation Lab CBDC cyber risks Bank of Israel CBDC

Bank of Hong Kong and Israel Are Collaborating to Test CBDC Cyber Risk

Ify Egede

Ify is an experienced and versatile writer and researcher. He has have keen interest in blockchain technology, Bitcoin, cryptocurrencies, fintech and emerging technologies. He has tons of published works both online and in the print media. He has close to a decade of writing experience. When he is not writing, he spends time with his lovely wife and kids.