The National Bank of Georgia (NBG) has outlined its ambitious aspirations to enter the world of central bank digital currencies (CBDCs) in a research paper. Global interest is being generated by the NBG’s upcoming limited-access live pilot of a digital lari.
Their project boasts the participation of nine distinguished companies, among them the blockchain giant, Ripple Labs. This endeavor signifies a significant stride towards the future of digital finance. The NBG’s aim? To explore the potential of a two-tier CBDC design, featuring third-party wallets and programmability, enabling seamless asset tokenization.
Varlam Ebanoidze, the NBG’s Head of Fintech, envisions an array of practical applications for the digital lari, including revolutionizing agricultural insurance and automating real estate transactions. But there’s more to the story. Ebanoidze hints at broader horizons, stating, “We are thinking about integration into the European Union and we want to be interoperable with the digital euro, but have monetary freedom.”
The journey towards a digital lari began in May 2021 when the NBG first revealed its contemplation of issuing a CBDC. January this year marked a call for expressions of interest from fintech firms eager to join a limited live pilot, setting the stage for the upcoming experiment.
But that’s not all. In a remarkable move, the NBG joins the ranks of observers in the Bank of International Settlements’ (BIS) Project mBridge. This international collaboration, involving countries like China, Hong Kong, Thailand, and the United Arab Emirates, aims to propel CBDC development further. The NBG seeks to “leverage knowledge and expertise” from the BIS’s Project Aurum, adding a global dimension to its CBDC aspirations.
With heavyweights like Ripple on board and an eye on international interoperability, the NBG’s journey into the digital lari promises to be a fascinating one. As the financial world watches with bated breath, the future of Georgian digital currency hangs in the balance, poised to redefine the nation’s financial landscape.