The central bank of Spain is conducting trials of digital central bank currencies (CBDCs) for wholesale purposes

The Bank of Spain (BDE) has announced a new experimental program to assess the viability of implementing wholesale Central Bank Digital Currencies (CDBCs) in an effort to better meet the “needs and demands of an increasingly digital society.”

The BDE is looking to collaborate with financial and technological institutions to launch the pilot program.

The program will concentrate on three main areas: simulating the transfer of funds, testing the liquidation of financial assets, and assessing the advantages and disadvantages of introducing a wholesale CBDC to the existing procedures and structure.

A December 5 statement, when translated, revealed that the bank will center its program on three main areas.

This program is designed to mimic the flow of funds, trial the selling of financial assets, and assess the pros and cons of incorporating a wholesale CBDC into its existing systems and infrastructure.

A wholesale CBDC is an exclusive program of the BDE, distinct from the European Union’s research into a digital euro.

This digital currency is primarily used by banks to maintain reserves with a central bank, in contrast to a retail or general-purpose CBDC which is accessible to the general public.

At a central bank conference on December 8, Brad Jones, Assistant Governor of the Reserve Bank of Australia (RBA), noted that many jurisdictions are analyzing and experimenting with CBDCs, mainly for retail purposes.

Nonetheless, he remarked that more organizations are exploring CBDCs “of a wholesale nature or interbank,” as well.

Jones went on to suggest that a retail CBDC could lead to people bypassing commercial banks altogether and, potentially, supplanting the Australian dollar.