BlockchainCryptocurrencyCryptocurrency RegulationsETH (Ethereum)

Norges Bank To Create An Ethereum-Backed Digital Currency

As cryptocurrencies keep gaining acceptance by businesses and individuals globally, several apex banks have realized the need to create a crypto version of their physical currencies. Norway is one of the several nations working on creating its cryptocurrency. They recently disclosed their CBDC model would be Ethereum based.

Major Success Towards CBDC Creation

According to their official statement, Norway’s apex bank has progressed in the creation stages for its CBDC. This development was announced by their partner, Nahmii, in an official publication.

Nahmii declared that the public can now access the source code through GitHub. Although they are still at the experimental stage, they added that the virtual currency would operate on the Ethereum blockchain.

Their virtual currency sandbox is built so that the interface enables ERC-20 token trading, minting, and burning. The publication also explained that MetaMask is not authorized in the network.

Also, only private transactions carried out by users with accepted credentials are supported by the source code version launched. The smart contracts are verified and controlled using the Grafana and BlockScout tools. The frontend also gives access to the transaction overviews.

In a tweet by their verified handle, Norway’s apex bank confirms the development, adding that the Ethereum network backs the model.

Norway’s Digital Currency

In April 2021, the bank disclosed its plan to sample its cryptocurrency on various networks for about two years to know which network is best for its virtual currency. They added that the virtual version of their currency would be called DSP.

They further published their working paper in November last year. The paper shows some possible blockchain-based models for their DSP. They added that they would adopt a design that is interoperable across blockchain networks.

The bank announced in May that its DSP would be issued, distributed, and even destroyed using the Ethereum blockchain. They added that they would examine all the vital features of their DSP prototype on the Ethereum network.

Creation Of CBDCs Globally

Only the Bahamas and Nigeria have inaugurated their digital currencies amongst the apex banks worldwide. A report by the International Monetary Fund in July, however, disclosed that over half of the apex banks globally are making efforts towards the creation of their digital currencies.

The IMF added that the IMF is also directing efforts toward making the CBDCs created in various countries interoperable. They also disclosed their plans to enable global trading of all CBDCs across borders.

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