The Central Bank of Montenegro, or CBCG, plans to develop a pilot program for a central bank digital currency with blockchain provider Ripple, even as it uses the euro as its de facto currency.
The central bank will identify practical applications of a CBDC and come up with a design to simulate its circulation, Ripple announced on Tuesday.
The project will "analyze the advantages and risks that CBDCs or national stablecoins could pose concerning electronic means of payment availability, security, efficiency, compliance with regulations, and most importantly, the protection of end users’ rights and privacy,” CBCG Governor Radoje Zugic said in the statement.
Montenegro is not a member of the European Union, but it has adopted the euro without joining the eurozone. The European Central Bank and EU are set to decide whether to introduce a digital euro later this year.
More than 100 countries are exploring the possibility of issuing a CBDC, which is a digitized form of central bank money for use by the public.
CORRECTION (April 11, 12:00 UTC): Corrects penultimate paragraph to say Montenegro is not an EU member and thus not in the eurozone; adds background of the country's relationship with the euro. An earlier version of the article incorrectly stated that Montenegro is in the EU and eurozone.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.