Digital Currency
Streamlining the financial landscape with innovative digital currency solutions
Overview
Digital currency is transforming the financial landscape by changing our understanding and usage of money. With the emergence of electronic cash and other forms of exchange that operate exclusively in digital form, a new era of finance has begun. This shift has prompted global central banks to explore the potential of developing national digital currencies, aiming to enhance transactional efficiency, improve financial inclusion, and create a more transparent and resilient monetary system.
What is digital currency?
Digital currency is a type of money that exists in digital or electronic form. Since it is not reliant on any physical form, it cannot easily be physically mishandled, altered, or manipulated, while offering the potential to boost transparency and cost-effectiveness. Both consumers and businesses can utilise digital currencies to streamline transactions and trades.
Key benefits of digital currency
Regulatory-compliant monetary streams
Certify transactions in real-time and eliminate potential theft or fraud while creating an indelible log of all monetary transactions.
Efficient public spending system
Provide citizens with direct access to digital currency whilst preserving privacy and introducing transparency, integrity, and traceability of money.
Counterfeit-resistant currency
Certify that money in circulation is officially issued and is legal tender through a tamper-proof ledger.
Types of Digital Currency
A central bank digital currency is an innovative, digital form of national money issued by a central bank that individuals and businesses can use to trade and make payments.
Traditionally, payment types have been categorised as either wholesale or retail, each with its own distinct payment systems. Wholesale payments involve only regulated financial institutions with reserve accounts at central banks, while retail payments encompass all other transactions, including those made by individuals using cards.
The tokenisation of currencies enables the creation of efficient, general-purpose systems accessible to any participant.
Designed to complement CBDC, Central Bank Money Tokens (CBMTs) are a tokenised version of “commercial bank money,” which refers to the type of money in an economy created through debt or deposits issued by regulated commercial banks.
Electronic money tokens (EMTs) present tokenised money used for exchange and linked to a single fiat currency. EMTs might be issued by a regulated non-bank payment company, such as under the Markets in Crypto Assets (MiCA) regulations, a framework for the regulation of crypto-assets and related activities within the EU member states.
An EMT is a digital representation of value or rights that can be transferred and stored electronically using distributed ledger technology or similar systems.
A central bank digital currency is an innovative, digital form of national money issued by a central bank that individuals and businesses can use to trade and make payments. (taken from existing playbook)
Traditionally, payment types have been categorised as either wholesale or retail, each with its own distinct payment systems. Wholesale payments involve only regulated financial institutions with reserve accounts at central banks, while retail payments encompass all other transactions, including those made by individuals using cards.
The tokenisation of currencies enables the creation of efficient, general-purpose systems accessible to any participant.
Designed to complement CBDC, Central Bank Money Tokens (CBMTs) are a tokenised version of “commercial bank money,” which refers to the type of money in an economy created through debt or deposits issued by regulated commercial banks.
Electronic money tokens (EMTs) present tokenised money used for exchange and linked to a single fiat currency. EMT might be issued by a regulated non-bank payment company, such as under the Markets in Crypto Assets (MiCA) regulations, a framework for the regulation of crypto-assets and related activities within the EU member states.
An EMT is a digital representation of value or rights that can be transferred and stored electronically using distributed ledger technology or similar systems.
nChain Solutions
nChain is at the forefront of digital currency innovation, offering comprehensive solutions that integrate Central Bank Digital Currency (CBDC), Commercial Bank Money Tokens (CBMTs), and Electronic Money Tokens (EMTs). Our advanced solution facilitates a seamless ecosystem for digital currency, allowing central banks, commercial banks, and financial institutions to leverage the power of blockchain technology.
