Project Mariana: Central Banks Successfully Test Cross-Border Digital Currency Trading
Summary:
The central banks of France, Singapore, Switzerland and the Bank for International Settlements (BIS) have jointly concluded a cross-border digital currency trading and settlement experiment, known as Project Mariana. The project focused on trading and settlement of hypothetical Central Bank Digital Currencies (CBDCs) over a public blockchain using decentralized finance (DeFi) technology concepts. BIS continues global promotion of CBDCs, executing several pilot tests across nations, with a focus on legal framework alignment where central banks cannot issue CBDCs. The exploratory project doesn't indicate any commitment by central banks to issue any CBDCs or support any particular technological solution.
The Central banks of France, Singapore, Switzerland and the Bank for International Settlements (BIS) have successfully completed a collaborative exploration into the trading and settlement of wholesale central bank digital currencies (CBDCs) across national borders. This report was released by The Banque de France on September 28. Project Mariana, named after their collaboration, was organized and managed by the Banque de France, Swiss National Bank and the Monetary Authority of Singapore under the supervision of BIS. The project implemented the trading and settlement of theoretical CBDCs in euro, Singaporean dollar, and Swiss franc denominations between fictitious financial institutions employing decentralized finance (DeFi) technology on a public blockchain. The operational methodology employs a common blockchain token standard, bridges for unfaltering transfer of CBDCs across varying networks, and a unique form of decentralized exchange for automated trade and settlement of spot foreign exchange deals, known as an automated market maker (AMM). A recent release revealed that participants expressed satisfaction with the experiment, though more research and testing is required. The exploratory nature of Project Mariana was also highlighted, noting that the project in no way signifies a commitment by the central banks to issue any form of CBDCs or to support DeFi or any specific technological solution. A day prior to Project Mariana's public release, BIS General Manager Agustín Carstens pressed for the convergence of respective national legal frameworks in countries where central banks are not authorized to issue CBDCs. Presently, BIS leads global efforts in promoting CBDCs across borders, conducting several pilot tests worldwide. In September, the collaborative Project Sela's results were disclosed by the central banks of Hong Kong and Israel while Eddie Yue, CEO of the Hong Kong Monetary Authority, announced the expansion of Project mBridge to include central banks from China, Thailand and the United Arab Emirates.
Published At
9/28/2023 9:08:21 AM
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