Sheikh Ahmed bin Khalid Al-Thani, Assistant Governor for Financial Instruments and Payment Systems at the Qatar Central Bank, disclosed that the banks involved in the high-value payment experiment, as well as the Central Bank of Qatar, will be involved in the digital currency project's pilot phase, which runs until October.
Sheikh Ahmed bin Khalid Al-Thani told Qatar News Agency (QNA) that by issuing and paying securities using digital money, QCB has created four use cases with regional and global banks.
After the pilot phase is over, the outcomes will be assessed and use cases for the future will be determined, he continued, either by creating retail use cases or by expanding use cases for settling high-value payments.
A unique platform for conducting digital transactions by participating institutions will be launched during the pilot phase. One Qatari riyal for every one digital currency (1:1) will be transferred to the platform as part of the digital currency account feeding process. In an experimental setting, the banks taking part in the pilot program will be able to trade, purchase, and sell financial assets using the digital currency.
Sheikh Ahmed bin Khalid Al-Thani stated that the idea of the digital money is broad in regards to the project beneficiaries. It is a method of payment for goods and services, and the value of the Qatari riyal is determined by the Qatar Central Bank by setting the exchange rate in relation to the US dollar.
Retail payments, also known as low-value transactions, occur when money is exchanged between people using the same currency. These transactions, usually referred to as wholesale payments or high-value transactions, can be made with the Qatar Central Bank as well as between banks. Finally, transfers made outside of the nation allow the currency to be utilized internationally. In this instance, the market exchange rate will be used to convert the local currency into a foreign currency.
He mentioned that four use cases involving domestic and foreign institutions will be included in the initial phase. The initial use case, which will boost productivity and lower the hazards involved with utilizing present systems, will be the settlement of bank-to-bank payments using digital money. The second use case involves using digital currency to purchase securities; the third use case involves using digital currency to sell and trade securities between banks; and the fourth use case involves using artificial intelligence technology to forecast liquidity levels. These use cases will aid the Qatar Central Bank in better understanding and researching the potential risks associated with using digital currency.
The first stage will run through October of this year. He said that following that, the outcomes would be assessed and potential uses will be determined, either by creating retail use cases or by keeping growing the number of use cases for settling high-value payments.
