October 13, 2023

Mastercard Succeeds in Using CBDCs in Purchasing NFTs

Mastercard x CBDC

Mastercard x CBDC

Mastercard, a global leader in payment solutions, recently announced the successful results of a groundbreaking trial. The trial involved wrapping central bank digital currencies (CBDCs) on multiple blockchains, similar to the mechanism behind wrapped Bitcoin (wBTC) and wrapped Ether (wETH).

This innovative experiment was conducted with the Reserve Bank of Australia (RBA), Australia’s Digital Finance Cooperative Research Centre CBDC, Cuscal, and Mintable. The trial has opened up new vistas in the realm of digital currency and NFTs.

According to an announcement, the trial had been conducted to demonstrate technology’s real-world applicability rather than merely a theoretical exercise.

The trial showed that a CBDC owner could buy an NFT listed on Ethereum, which is one of the most popular blockchains. To achieve this, the required amount of pilot CBDC was “locked” on the RBA’s platform, and an equal amount of wrapped pilot CBDC tokens was minted on Ethereum.

The experiment was a technological achievement and a testament to the secure and controlled environment in which the transaction took place. Both the buyer’s and seller’s Ethereum wallets and the NFT marketplace smart contract were “allow-listed” within the platform. This ensured that all other transfers of the wrapped pilot CBDC were blocked.

The platform demonstrated its ability to implement controls even on public blockchains, thus guaranteeing the security and legitimacy of transactions.

In June 2023, Mastercard’s Multi Token Network played a crucial role in a trial that combined payment technology with blockchain capabilities. Zack Burcks, CEO and founder of Mintable commented that together with Mastercard, they identified a use case where digital currencies and NFTs can be easily linked, which could potentially eliminate fraud and theft, put an end to the loss of documentation and records, and create new possibilities for commerce.

Author profile

UPYO employs a team of expert technical writers to create engaging stories about technology and its evolution. Our team is a group of NFT enthusiasts with a knack for all things Web3. They write with the goal of educating our clients to understand the complex and often confusing concepts of cryptography and NFT. We want our readers to extract knowledge from our blog and help them make informed decisions in the NFT market.