BIS building a multi-CBDC bridge for cross-border payments

Wednesday 29 September 2021 12:30 CET | News

Switzerland-based Bank for International Settlements (BIS) has announced testing its blockchain-based multi-CBDC prototype for cross-border payments in an initial test. 

Together with four central banks, the BIS has developed a prototype platform with distributed ledger technology (DLT) for several CBDCs and has now successfully tested it. The prototype of the common platform for mCBDC processing was able to complete international transfers and foreign exchange transactions in seconds. In addition, according to the project report, the cost of such operations for users can be cut by up to half.

The preceding ‘m’ in the mBridge project and in mCBDCs stands for ‘multiple’ and refers to the openness of the project. The prototype presented is designed for mCBDCs, which combine national digital currencies in common interoperable platforms. mBridge is designed with multiple lanes, can be driven in both directions and it is intended to serve as an expressway with crossings and direct connections for cross-border payments for numerous participants.

In the next steps, mBridge plans to investigate the remaining limitations of the current platform with regard to data protection controls and liquidity management, including analyses of the scalability and performance of DLT when processing large transaction volumes. In addition, the project pipeline will include political requirements and measures to ensure compliance with country-specific regulations. The next phases of the project are expected to include trials in a safe and controlled environment with commercial banks and other market participants.

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Keywords: report, CBDC, cryptocurrency, DLT, cross-border payments
Categories: DeFi & Crypto & Web3
Countries: Switzerland
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DeFi & Crypto & Web3

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