The Central Bank of Ghana has achieved a major milestone in digital cross-border trade with the successful completion of its first proof of concept (POC) for Project DESFT (Digital Economy Semi-Fungible Token).
Director of Fintech and Innovation at the Central Bank of Ghana, Kwame Oppong, made the announcement at the 3i Summit on May 15. He highlighted the completion of a cross-border transaction using the ‘eCedi’ and an approved stablecoin from Singapore as a significant achievement.
“The Bank of Ghana is pleased to announce the successful first proof of concept for Project DESFT, which showcases the execution of a cross-border transaction payment using digital credentials, the eCedi, and an approved stablecoin from Singapore,” Oppong said.
Launched in June 2023 in partnership with the Monetary Authority of Singapore (MAS), Project DESFT initially focused on developing a trusted credential system. This system converts important information into verifiable digital credentials on a secure distributed ledger, making it easy for trade partners and financial institutions to verify their authenticity.
The success of phase one led to the implementation of Phase 2 in April 2024, which expanded cross-border trade between Ghana and Singapore even further.
“Building on this foundation, in April 2024, Phase 2 of Project DESFT successfully completed a cross-border trade between Ghana and Singapore, using the DESFT solution, Universal Trusted Credentials, a Singapore Stablecoin, the eCedi, and the Purpose Bound Money protocol,” Oppong explained.
The live transactions demonstrated the potential of using the eCedi in cross-border transactions, showing its ability to work with various credential and payment platforms. The addition of the eCedi is expected to greatly improve Ghana’s payment ecosystem, promoting growth and innovation while enhancing consumer experiences.
“The live transactions also showed the possibility of using the proposed Ghanaian domestic retail CBDC platform, the eCedi, in cross-border transactions. This highlights the potential of the eCedi system for future interoperability with different cross-border credential and payment platforms,” Oppong added.
Project DESFT aims to support SMEs in Africa by addressing challenges in international trade, such as building trust with foreign partners and facilitating cross-border payments. The project has created 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 introduction of the eCedi is set to enhance Ghana’s payment ecosystem, fostering growth and innovation while improving consumer experiences.