Payments giant Western Union is collaborating with a $75 billion bank to study the effects of a US central bank digital currency (CBDC).
According to a new press release, Western Union and Philippines-based BDO Unibank are working together to explore how the implementation of a US CBDC, or a digital asset issued and backed by the Federal Reserve, would impact overseas remittances.
“The pilot study, executed in concert with a leading, technology-driven global payments player, evaluated the potential benefits of utilizing CBDCs for cross-border remittances.”
The study, published in the Digital Dollar Project’s whitepaper, highlighted many benefits of implementing a CBDC, including reducing risk due to instant settlement across multiple currencies, optimized cost, and enhanced security and transparency.
As stated by Kevin Mole, global head of digital assets at Western Union,
“Through this pilot study, Western Union has identified several advantages for customers and financial institutions, laying the groundwork for ongoing evaluations of the feasibility and viability of utilizing retail CBDCs for cross-border remittances.”
However, earlier this year, a survey revealed that the overwhelming majority of American citizens oppose a CBDC as it would give the federal government oversight on their spending habits.
At the time, the poll found that 74% of respondents would oppose a CBDC if it means that the government could control how they spend their money while 68% said they’d oppose it if it meant that the government could track how they spend their money.
Furthermore, 59% of those surveyed said they’d opposed a CBDC if it would allow the state to freeze the bank accounts of American protesters. The research also found that only 16% of US adults support the issuance of a CBDC.
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