By George Ward
Changpeng Zhao, the CEO of Binance, revealed on Twitter that Binance’s BNB Chain would be instrumental in Kazakhstan’s CBDC development. Meanwhile, Kazakhstan has been considering the idea of a CBDC since 2021.
Kazakhstan To Integrate BNB Chain In CBDC Development
In 2021, Kazakhstan’s central bank revealed that it is considering the idea of a CBDC. However, the bank will decide on the matter in December 2022.
On his Twitter page, Zhao talked about Binance’s recent exploits in Kazakhstan. According to him, the firm is pushing for global crypto adoption.
As a result, he has recently met with Berik Sholpankulov, the Deputy Governor of the NKB (National Bank of Kazakhstan). Zhao also met with Binur Zhalenov, the Head of the bank’s Payments and Technology Center.
From the meeting, both parties agreed to integrate the BNB Chain into Kazakhstan’s CBDC, the digital Tenge. However, more details are not available about the structure of the CBDC.
Meanwhile, multiple reports claim that the CBDC would have a multi-chain architecture. Moreover, the NKB stated last year that it would pilot the CBDC on R3’s Corda platform.
Recently, Kazakhstan conducted a CBDC pilot test in a controlled environment. Some merchants and real consumers took part in the pilot test.
Two of the largest banks in the country took part in the pilot test. They include the Eurasian Bank JSC and Kaspi Bank JSC.
The model of Kazakhstan’s CBDC is two-tiered. This means the NBK regulates the entire CBDC system.
Meanwhile, smaller banks will have to open digital wallets for the digital Tenge. This will allow users to redeem and exchange digital Tenge and transfer between banks.
Binance Receives Permanent License In Kazakhstan
Furthermore, Kazakhstan’s central bank added that its CBDC would not replace cash payment. Instead, the digital Tenge will complement the fiat currency.
Therefore, banks will not record the CBDC in their balance sheets. Instead, it will be recorded in consumers’ digital wallets.
Zhao said he wants to see how NBK would develop use cases for its CBDC. The crypto entrepreneur believes this development will connect the crypto ecosystem and traditional banking.
According to Zhao’s tweet, Binance has a good relationship with the Kazakhstan government. The recent news comes after Binance obtained a license to function as a VASP (Virtual Asset Service Provider) in Kazakhstan.
Hence, Binance can now operate a crypto platform and offer crypto custody services. Also, Binance can offer fiat currency withdrawal, deposit, and crypto trading.
Additionally, the Kazakhstan government granted Binance approval for another project. As a result, the crypto exchange will be developing a crypto marketplace in the country. Therefore, the exchange has signed an MOA with the Financial Supervisory Authority of Kazakhstan.
Meanwhile, Zhao explained that the deal is part of Binance’s Law Enforcement Training Program (LETP). The program aims to fight cybercrime. LETP is available in Paraguay, Israel, Germany, Italy, France, Norway, Brazil, Paraguay, and Canada.