A blockchain startup backed by China hopes to bridge the gap between CBDCs and stablecoins.
At the World Economic Forum in Davos, Red Date Technology revealed a worldwide payment system for digital tokens.
The network will facilitate cross-border payments for CBDCs and stablecoins, making both interoperable.
SWIFT of digital tokens aims to bridge CBDCs and crypto stablecoins
Red Date Technology, based in Hong Kong, are the architects behind China's Blockchain-based Service network (BSN). At the World Economic Forum, the company announced the development of a Universal Payment Network (UDPN).
- Read more: The World Economic Forum wants to work with Shiba Inu (SHIB)
The UDPN will facilitate cross-border payments for digital currencies such as CBDCs and crypto stablecoins from anywhere in the world.
According to Red Date Technology’s whitepaper:
As an ever-increasing number of CBDCs and regulated stablecoins come
online, the need for interoperability grows. The UDPN meets this need, offering lower payment costs and rapid, seamless distribution
The UDPN will be for the future of banking in relation to cryptographic technology and CBDCs, inspired by the SWIFT network for traditional financial institutions.
- Read more: UK to launch GBP stablecoin, CBDC pound could follow
The UDPN itself is backed by distributed ledger technology (DLT). For comparison, blockchains like Solana and Ripple (XRP) are also DLT-based networks.
Numerous "global tier 1 banks" are already on board with the UDPN, according to Red Date Technology, and have access to proof-of-concept copies of the technology.
Regarding Ethereum and Bitcoin, Red Date Technology said the UDPN will not support Bitcoin or unregulated cryptocurrencies.
From the whitepaper:
The network will support only CBDCs and regulated fiat-backed stablecoin
currency systems as payment methods. No unregulated public-chain crypto-
currencies, such as Bitcoin, will be accepted.
Yifan He, Red Date Technology’s CEO called cryptocurrencies a “ponzi scheme” in a local Chinese newspaper. No release date has been announced for UDPN.