BIS Unveils Project Tourbillon, Showcases CBDC’s Potential to Preserve Privacy
In Brief
The Bank for International Settlements (BIS) introduced Project Tourbillon, showcasing the potential of CBDCs in preserving privacy.
The Bank for International Settlements‘ (BIS) Innovation Hub Swiss Centre introduced Project Tourbillon, aiming to showcase the potential for preserving privacy in transactions involving central bank digital currencies (CBDC).
The project is focused on testing the concept of payer anonymity, offering cash-like privacy to payers while not extending the same anonymity to payees.
In Project Tourbillon’s report, central banks examined payment scenarios where users could make transactions without disclosing personal information to any party, including the merchant.
However, the merchant’s identity would be revealed to their bank during the payment process, aiding in mitigating tax evasion and illicit payments. The results indicated that it is possible to maintain privacy in transactions involving CBDCs.
Project Tourbillon delved into both current and quantum-safe blind signatures—a crucial cryptographic aspect in both designs to guarantee privacy and future security. The project demonstrated the feasibility of implementing quantum-safe cryptography, though it highlighted the need for specialized expertise and the potential limitation of transaction processing speed, necessitating further research for speed enhancement.
“Privacy is an important user requirement but it is the most difficult to solve. The difficulty lies in ensuring privacy protection technologically rather than just promising it, and at the same time ensuring that such a high level of protection cannot be abused”, said Thomas Moser, Alternate Member of the Governing Board at the Swiss National Bank, in a written statement.
Privacy is a Top Priority For European Central Bank
Project Tourbillon is a first step in exploring privacy, security and scalability for CBDC design, conducted by BIS. The project involved building two scalable prototypes that could handle a growing number of transactions.
As jurisdictions globally explore the issuance of digital versions of sovereign currencies, privacy has become a significant public concern.
In the development of the digital euro, the European Central Bank has prioritized privacy as a crucial feature for both European citizens and professionals.
According to the “Eurosystem report on the public consultation on a digital euro” conducted by the entity, privacy is identified as one of the key features that a digital euro should provide, particularly among professional clusters.
These clusters include consumer associations and trade unions, followed by NGOs and professionals in the banking industry.
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About The Author
Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
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Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
