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Davos Wants To Be The “SWIFT” Of Stablecoins And CBDCs


news.coincu.com 23 January 2023 06:55, UTC
Reading time: ~3 m

The Universal Digital Payment Network (UDPN) was introduced on January 19 at the World Economic Forum (WEF) 2023 conference in Davos, Switzerland, by Red Date Technology, a blockchain infrastructure company that is also in charge of one of China’s blockchain initiatives.

UDPN development is also supported by the digital asset generation engine TOKO from the law firm DLA Piper and the tech engineering business GFT Technologies.

According to its white paper, the UDPN is a distributed ledger technology (DLT) platform that would serve a similar purpose to what the SWIFT network does for banks, except for stablecoins and CBDCs.

“Just as the SWIFT network created the original common standard for messaging between financial institutions across different settlement systems, the UDPN will serve the same purpose for the emerging generation of CBDCs and stablecoins.”

A “several of global tier 1 banks” are reportedly already engaged in use case proof of concepts (POCs) to test the network in cross-border transfers and swaps, according to a press release from January 19.

Although the statement did not specify which banks were participating in the POCs, a panel at the UDPN launch in Davos included representatives from Deutsche Bank, HSBC, Standard Chartered, The Bank of East Asia, and Akbank.

The stablecoins to be used in the POC were also undisclosed. The networks whitepaper does state, however, that it only supports “CBDCs and regulated fiat-backed stablecoin currency systems as payment methods,” adding:

“No unregulated public-chain crypto-currencies, such as Bitcoin, will be accepted.”

Eight other proof-of-concept tests are scheduled for the network, including issuing and circulating a CBDC and bank-issued stablecoin and using UDPN as a payment gateway for e-commerce.

Red Date has been working on the UDPN for almost two years

The business was well-known for its work on China’s national blockchain initiative, Blockchain-based Service Network (BSN), before introducing this digital payments system.

The BSN stated that it intended to create a global CBDC system that “would fundamentally transform the current payment and circulation mechanism, enabling an uniform digital currency transfer method and payment procedure for any information system” in a now-deleted roadmap posted on Jan. 15, 2021.

Red Date’s role in leading China’s blockchain initiative and the nation’s own CBDC efforts with its digital yuan are not mentioned in the most recent white paper.

According to a project spokeswoman, there is “absolutely no relationship” between UDPN and BSN because the latter is “controlled and administered in a decentralized manner.”

Yifan He, CEO of Red Date, referred to cryptocurrency as the “largest Ponzi scam in human history” in June.

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