The Qatar Central Bank (QCB) has announced the launch of its digital currency project, aiming to stay ahead of global advancements in the financial sector.
This initiative follows the completion of the necessary infrastructure development for the project.
According to Qatari newspaper Al-Sharq, the QCB will begin testing and developing selected applications of its digital currency in a controlled environment.
This trial will involve both domestic and international banks, focusing on the settlement of high-value payments using the latest technological advancements.
The central bank’s digital currency project aims to enhance access to capital markets for banks operating within Qatar and to improve local settlement processes. Additionally, the project seeks to increase the efficiency of securities transactions.
The first phase of the project, which will continue until October, will explore the utilization of artificial intelligence, decentralized ledger technology, and other emerging technologies.
The goal is to establish a robust foundation that enhances liquidity by expanding participation in financial market facilities.
The QCB hopes that the outcomes of this trial will serve as a cornerstone for defining future stages, ultimately contributing to the improvement of current systems and enabling instant settlements.
Qatar’s venture into digital currency follows the United Arab Emirates’ announcement in April of the first phase of their Central Bank Digital Currency (CBDC) strategy, known as the “Digital Dirham.”
Sadiq Al-Rikabi, Director of the Global Center for Development Studies, highlighted in March the impact of shifting towards investments in national digital currencies on the dominance of the US dollar.
He noted that a decade ago, countries’ dollar reserves represented 80% of their foreign currency reserves, a figure that has now decreased to 53%.
In contrast, the volume of digital currency transactions exceeded $10 trillion in 2020 and has continued to grow significantly.
Al-Rikabi pointed out that the rise in digital currency investments has caused concern among companies accustomed to transacting in dollars, leading to noticeable changes in international trade patterns.
Currently, more than 11 countries are exploring digital currency activities and their use in global commerce.
