MAS, NY Fed Publish Report on Wholesale CBDC Study for Cross Border Payments

MAS, NY Fed Publish Report on Wholesale CBDC Study for Cross Border Payments

by May 22, 2023

The New York Federal Reserve and the Monetary Authority of Singapore (MAS) has published the report on the findings of their cross-border payments study.

The Project Cedar Phase II x Ubin+ (Cedar x Ubin+) experiment found that distributed ledger technology (DLT) could be used to improve the efficiency of cross-border wholesale payments and settlements involving multiple currencies.

The experiment was conducted in a test environment and the hypothetical payments were settled using simulated wholesale central bank digital currencies (CBDCs).

The findings addressed three key pain points which included interoperability and autonomy. The Cedar x Ubin + experiment interlinked the distinct central bank currency ledgers, providing flexibility in the design and operation of each ledger to the respective central bank.

This enabled payments to be safely executed across multiple ledgers without the need for a central clearing authority or the establishment of a shared central network.

The second pain point was atomic settlement, meaning transactions were only settled if all legs in the cross-currency payment chains were executed successfully.

Lastly, each simulated payment scenario achieved end-to-end settlement in under thirty seconds on average.

The study also revealed research areas for future experimentation and analysis, including around the viability of the network solution to manage transaction volumes at scale.

This includes potentially increasing payments settled per second and the involvement of additional currencies supported by their corresponding central bank ledgers.

MAS said that the Cedar x Ubin+ report is not intended to advance any specific policy outcome, nor to signal that the Federal Reserve or the MAS will make any imminent decisions about the appropriateness of issuing a CBDC.

Michelle Neal

Michelle Neal

Michelle Neal, Head of the Markets Group at the New York Fed said,

“Cross-border payments are a major railway for facilitating the functioning of the global economy.


Our research collaboration with the MAS reveals key opportunities for central bank innovation to play an important role in easing wholesale payment flows globally and improving settlement outcomes.”

Leong Sing Chiong

Leong Sing Chiong

Leong Sing Chiong, Deputy Managing Director (Markets & Development), MAS said,

“The Cedar x Ubin+ experiment envisages a future digital currency landscape where central banks can enable interoperability of wholesale CBDCs to facilitate more efficient cross-border payment flows including for less liquid currencies, without requiring a common infrastructure.”