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Digital transformation solutions provider UST is now an innovation vendor for Project Rosalind, an experiment in application programming interface (API) prototypes for central bank digital currencies (CBDC) initiated by the Bank for International Settlements (BIS) and the Bank of England (BoE) via the BIS Innovation Hub London Centre.
Public goods in tech space
The BIS established the London Centre in 2021 and is one of six international nodes working to develop public goods in the technology space to support central banks and improve the functioning of the financial system. Its current focus areas are CBDC, next-generation financial market infrastructure, and supervisory technology (suptech).
APIs to distribute retail CBDCs
Project Rosalind united leading innovators from various industries to develop and test prototypes for an API to distribute retail CBDCs, which have the potential to positively disrupt and drive innovation across several sectors, a spokesman for UST said here. The company collaborated with BIS and BoE to develop an API layer as well as explore a range of use cases for the CBDC ecosystem.
Krishna Sudheendra, CEO, UST
Testing and validation
A prototype API layer was developed, featuring 33 API endpoints grouped into six functional categories. More than 30 use cases were identified and explored by public and private sector collaborators, serving as testing and validation for the architecture and features of the API, the spokesman added.
Privacy, accountability
The success of Project Rosalind proved that API layers can help safely distribute CBDC to consumers via private sector service providers while simultaneously enhancing privacy, accountability, and convertibility, the spokesman said. “UST played a pivotal role organising the API development work, running innovation sessions as well as building a secure and functional API layer,” he added.
Tie-up with Quant
UST also partnered with Quant, a blockchain for finance pioneer, to provide the underlying infrastructure and blockchain platform. Quant has spearheaded the Blockchain ISO Standard TC307 adopted by 57 countries and created the interoperable blockchain platform Overledger.
Central bank innovation
Francesca Hopwood Road, Head of the BIS Innovation Hub London Centre, said theRosalind experiment has advanced central bank innovation in two key areas: exploring how an API layer could support a retail CBDC system; and how it could facilitate safe and secure CBDC payments through a range of use cases.
Potential of digital currency
Krishna Sudheendra, CEO, UST, said digital currency has the potential to transform financial enterprises and revolutionise end-user experience. Project Rosalind showcases how public-private collaboration and innovation can significantly accelerate time-to-market for solutions and result in tangible benefits for everyone, he said.
Leveraging experience
Tanveer Mohammed, UST’s head of innovation for the UK, said innovation is at the centre of UST’s transformation projects, and it put those principles into practice through this partnership. “We leveraged our engineering experience and approached the collaboration with an agile and aligned mindset. Strengths of each company combined to deliver an outstanding product,” he added.
Central bank ledger
Project Rosalind has demonstrated how a well-designed API layer can help a central bank ledger interact with private sector service providers to safely provide retail CBDC payments, the UST spokesman said. It also revealed the potential of a CBDC system to enable a robust ecosystem to foster innovation, and help meet future needs of a more digitalised society.
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