The Bank for International Settlements (BIS) and Three Central Banks Test CBDC Experiment Using DeFi Networks
The Bank for International Settlements (BIS), along with the central banks of France, Singapore, and Switzerland, has conducted a successful cross-border trading experiment using central bank digital currencies (CBDCs) and decentralized finance (DeFi) technology. The experiment, called “Project Mariana,” focused on testing the effectiveness of cross-border trading and settlement of wholesale CBDCs (wCBDCs) between simulated financial institutions.
Wholesale CBDCs are used by banks for settling wholesale payments, while retail CBDCs are offered to the general public for payments. The experiment used hypothetical euro, Singapore dollar, and Swiss franc wCBDCs, along with a common technical token standard provided by a public blockchain to facilitate currency exchanges. Bridges were also utilized for transferring wCBDCs, and an automated market maker (AMM) enabled trades.
It is important to note that Project Mariana was purely experimental and does not imply that any of the participating countries have plans to issue wCBDCs or adopt DeFi technology.
Hot Take
BIS and three central banks have successfully completed an experimental CBDC project that tested cross-border trading using decentralized finance networks. This initiative explored the potential of central bank digital currencies in facilitating wholesale payments and settlements between financial institutions. While the project was purely experimental and doesn’t indicate immediate plans for wCBDC issuance or DeFi adoption, it highlights the ongoing efforts to explore innovative technologies in the financial sector. As central banks continue to study CBDCs and their potential applications, experiments like Project Mariana provide valuable insights into the possibilities of future digital currency systems.
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