More than 40 financial institutions and eight central banks have tested a shared platform for tokenised cross-border payments under Project Agorá.
The initiative, led by the Bank for International Settlements (BIS) and the Institute of International Finance (IIF), is exploring whether tokenisation can improve wholesale cross-border payments.
Its prototype combines tokenised central bank reserves and commercial bank deposits on a single programmable platform.
This allows multi-currency transactions to settle atomically, meaning the payment and related transaction are completed at the same time.
The platform could also support around-the-clock settlement if implemented.
The eight participating central banks are the Bank of Canada, Bank of England, Bank of Japan, Bank of Korea, Bank of Mexico, Banque de France for the Eurosystem, Swiss National Bank and the Federal Reserve Bank of New York through its New York Innovation Center.
Project Agorá is testing how smart contracts could automate payment conditions, compliance requirements and transaction workflows.
The approach could reduce reconciliation work, manual intervention and other operational delays in cross-border payments.
The project is also examining legal and regulatory issues including settlement finality, anti-money laundering and counter-terrorist financing requirements, and data privacy.
Project Agorá remains a prototype rather than a commercial payment system.
Further testing is planned, including real-value transactions involving selected currencies and participants.
The next phase is expected to give private-sector participants a larger role while participating central banks remain involved.
Featured image: Edited by Fintech News Singapore, based on image by riskytolen31 via Magnific
