Points
- Kazakhstan launches a pilot project to use its digital tenge CBDC for paying for a rail line to China.
- The project marks the beginning of the second phase of CBDC introduction.
- The digital tenge ensures transparency, targeted use, and efficiency in fund disbursement.
Kazakhstan has initiated a pilot project to use its digital tenge central bank digital currency （CBDC） for financing the construction of a rail line to China. The project utilizes “marked,” or programmable, digital tenge to ensure allocated funds reach the intended recipients at the right time, marking the second phase of the CBDC introduction.
The National Bank of Kazakhstan （NBK） stated that this initiative would enhance transparency, ensure targeted use, and improve efficiency in fund disbursement.
Cointelegraph
Government Money Spent as Intended
Marking was implemented throughout the supply chain using existing interfaces of market participants. The funds were disbursed upon completion of the work, ensuring they were used for their intended purposes.
During the pilot launch, the digital tenge was marked and paid only to organizations that had fully fulfilled their required obligations. This pilot project funded the enlargement of the rail line between Moyynty in central Kazakhstan and Dostyk on the Chinese border, part of the Belt and Road transit corridor linking China with Western markets.
Involvement of National Funds and Future Expansion
The Kazakhstan National Fund sovereign wealth fund financed the project. The government and the state Anti-Corruption Agency plan to extend the project to targeted expenditures in agriculture, construction, and social benefits. The NBK stated that other banks would be included as the project expands.
How Smart is a Smart CBDC?
The first phase of the digital tenge pilot concluded in December, encompassing a wide range of functions from providing free school lunches to implementing cross-border payments on the SWIFT system. The Kazakhstan CBDC infrastructure has been integrated with the BNB Smart Chain. The country aims for a full rollout of its CBDC by 2025.
The NBK and the People’s Bank of China signed a memorandum of understanding on joint CBDC research during Chinese President Xi Jinping’s state visit to Kazakhstan on July 10.
Conclusion
Kazakhstan’s pilot project to use digital tenge for funding a rail line to China is a significant step in the country’s CBDC journey. The project highlights the benefits of programmable digital currency in ensuring transparency, efficiency, and targeted use of government funds.
解説
- Transparency and Efficiency: The use of programmable CBDC ensures that government funds are used as intended, enhancing transparency and efficiency in public spending.
- Pilot Project Success: The successful implementation of the pilot project demonstrates the potential of digital currencies in large-scale infrastructure projects and sets a precedent for future initiatives.
- International Collaboration: The collaboration between Kazakhstan and China on CBDC research indicates a growing interest in digital currencies and their applications in international trade and finance.