By: Eva Baxter
The Bank for International Settlements (BIS), along with France, Singapore, and Switzerland's central banks have successfully completed the experimental phase of Project Mariana. The initiative focuses on the cross-border trading and settlement of wholesale central bank digital currencies (wCBDCs).
Project Mariana was developed to test the cross-border trading and settlement of hypothetical euros, Singapore dollars, and Swiss francs wCBDCs between simulated financial institutions. The project utilized three key components: a common token standard, bridges for the bypass-free transfer of wCBDCs across networks, and an Automated Market Maker (AMM) for instant pricing and settlement of spot FX transactions.
Despite the success of this initial experimentation, BIS General Manager Agustín Carstens emphasized the need to further examine the legal frameworks for implementing such technology. Carstens points out that existing, outdated legal frameworks should not obstruct the deployment of CBDCs. Thus, further research and collaboration are evident in the journey toward implementing these currencies.
It's important to note that Project Mariana was solely an experimental project and does not imply the intentions of the partner central banks to issue wCBDCs or endorse DeFi. However, the experiment provides valuable insights into leveraging distributed ledger technology for cross-border wholesale CBDC settlements and the potential benefits and limitations of using AMMs for spot FX trading.
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