The Central Bank of Ghana has announced the successful completion of its first proof of concept (POC) for Project DESFT (Digital Economy Semi-Fungible Token), marking a significant milestone in the realm of digital cross-border trade.
Kwame Oppong, Director of Fintech and Innovation at the Central Bank of Ghana, made the announcement during the recently concluded 3i Summit on May 15. He highlighted the execution of a cross-border transaction using the ‘eCedi’ and an approved stablecoin from Singapore as a major achievement.
“Today, the Bank of Ghana wishes to announce the successful completion of the first proof of concept as part of Project DESFT, which demonstrates the successful execution of a cross-border transaction payment using digital credentials, the eCedi, and an approved stablecoin from Singapore,” Oppong stated.
Launched in June 2023 in collaboration with the Monetary Authority of Singapore (MAS), Project DESFT’s first phase focused on developing a trusted credential system. This system transforms crucial information, such as licenses, certificates, and trade records, into verifiable digital credentials on a secure distributed ledger, allowing trade partners and financial institutions to efficiently verify their authenticity.
The success of the initial phase led to the execution of Phase 2 in April 2024, which further expanded the scope of cross-border trade between Ghana and Singapore.
“Expanding upon this groundwork, in April 2024, Phase 2 of Project DESFT successfully executed a cross-border trade between Ghana and Singapore, leveraging the DESFT solution, Universal Trusted Credentials, a Singapore Stablecoin, the eCedi, and the Purpose Bound Money protocol,” Oppong elaborated.
The live transactions showcased the feasibility of using the eCedi in cross-border transactions, affirming its potential for future interoperability with various credential and payment platforms. The introduction of the eCedi is expected to significantly enhance Ghana’s payment ecosystem, promoting inclusive growth and innovation while improving consumer experiences.
“The live transactions further demonstrated the feasibility of utilizing the proposed Ghanaian domestic retail CBDC platform, the eCedi, in cross-border transactions. This affirms the potential of the eCedi system for future interoperability with various cross-border credential and payment platforms,” Oppong added.
Project DESFT aims to support SMEs in Africa by overcoming obstacles in international trade, such as establishing trust with overseas partners and facilitating cross-border payments. The project has developed a reliable information exchange solution based on UTC standards and Semi-fungible Token technology, and tested a cross-border payment solution using Purpose Bound Money (PBM) principles, according to the central bank.
The prospective introduction of the eCedi is poised to significantly enhance Ghana’s dynamic payment ecosystem, fostering inclusive growth and innovation while improving consumer experiences.
