According to the press release, Project Sela "demonstrated the technical feasibility of a retail central bank digital currency architecture that can promote competition and innovation in digital payments by allowing non-bank payment intermediaries to connect directly to the CBDC ledger of the central bank. Leveraging distributed ledger technology (DLT), a proof-of-concept prototype was developed to showcase how the technical implementation of the proposed architecture can incorporate strict cybersecurity, legal and policy requirements."

The document: 

• examines the features that are necessary in order to generate a broad adoption of a digital shekel by the public as a means of payment, and the creation of a network effect; 
• discusses the structure of the incentives of merchants in relation to the adoption of a new method of payment;
• examines the technological requirements that would lead to successful adoption of a digital shekel; 
• discusses the digital shekel as a legal tender, and its implications for the potential adoption of the digital shekel; and 
• finally, three short discussions are conducted regarding the future payment applications, offline payments, and cross-border payments, and the way these will affect the design of the digital shekel during its development stages, with the aim of making it attractive compared to existing means of payment and creating broad adoption scopes.

The document raises various issues for discussion and examination, but does not explicitly set out any Bank of Israel decisions that may be made as part of a future work plan.

The report discusses the conditions that would enable or support a decision to issue a Bank of Israel digital currency at some point, and indicates a number of variables that may have an effect on the Bank of Israel Steering Committee’s recommendation:

• CBDC issuances by other countries.
• Decline in the legitimate use of cash and its acceptance in transactions in Israel. 
• Significant penetration of stablecoins or other private means of payment that would be broadly used might impair the payment system.
• The extent of competition in the domestic payment system.
• Technological developments in the payments system.

The project explored a specific way to "interlink rCBDC systems (the hub-and-spoke solution) with several additional features that would allow the Icebreaker model to be readily scaled up. In addition, these features would promote simplicity and interoperability, reduce settlement risk, and foster competition and transparency for cross-border rCBDC payments." 

Project Icebreaker showed that central banks can have "almost full autonomy when designing their domestic rCBDC system while still being able to participate in a formalised interlinking arrangement to enable cross-border payments."

The following benefits were highlighted from the project:

• It enables cross-border interoperability, allowing systems with different technologies to talk to each other in a standardised way.
• It reduces settlement and counterparty risk by the use of coordinated payments in central bank money.
• It allows increased competition and choice for consumers, by decoupling the provision of an FX service from the FX transaction, as well as through the use of bridge currencies.
• It helps reduce costs.
• It helps achieve increased cross-border reach.
• It is scalable, easily connecting the systems of many countries.
• It is fast; transactions take just seconds to complete.
• An rCBDC does not need to leave its rCBDC system.

The collaboration will see the development of a “hub” to which participating central banks will connect their domestic proof-of-concept CBDC systems. The objective is to test some specific key functions and the technological feasibility of interlinking different domestic CBDC systems.

The architecture is designed to enable immediate retail CBDC payments across borders at a significantly lower cost than with existing systems.

The project will run through the end of the year, with a final report expected in the first quarter of 2023.

Called Project Sela, the research will study the data security implications of a two-tier retail CBDC architecture where the intermediaries will have no financial exposure, and pioneer methods of making it more resilient to cyber-attacks. The Project is expected to be completed by the end of 2022.