According to a paper released on Thursday, the Bank for International Settlements (BIS) and the central banks of France, Singapore, and Switzerland successfully tried out cross-border trade of wholesale central bank digital currencies (wCBDC).
A notional euro, Singapore dollar, and Swiss franc wCBDCs between fictitious financial institutions were utilised in Project Mariana’s proof of concept. The project’s foundation was “a common token standard on a public blockchain which facilitates interoperability and seamless exchange of wCBDC across varied local payment and settlement systems maintained by participant central banks,” according to an accompanying press release.
Project Mariana intended to test how international and exchange settlement may look in a world where central banks have issued a CBDC in light of the increasing number of countries exploring the issuance of a wholesale CBDC, which facilitates the settlement of interbank transfers, including nations in Europe and Asia. In June, the Banque de France stated that wholesale CBDCs might enhance cross-border payments.
“Project Mariana is a leader in the application of cutting-edge technology to interbank foreign exchange markets. It effectively showed that it is possible to transact in wholesale CBDC utilising cutting-edge ideas like automated market makers (AMM),” according to Cecilia Skingsley, head of the BIS Innovation Hub. AMMs, which operate independently of a central clearing house, served as a decentralised exchange in this experiment.
The paper noted that “the project even used smart contacts to enable central banks to manage their wCBDC without directly operating or controlling the underlying platform.”
According to the news announcement, the project’s DeFi (decentralised finance) components, in particular the automated market makers, “could serve as the foundation for a new generation of financial market infrastructures.”