Digital central bank money is moving ever closer. Even so, the monetary authorities of Singapore, France, and Switzerland reiterate the project is «purely experimental.»
The Bank for International Settlements (BIS) and the central banks of Singapore, France and Switzerland have completed Project Mariana, according to a statement Thursday.
The project tested cross-border trading and settlement in wholesale central bank digital currency (wCBDC) between financial institutions based on new technological concepts from decentralized finance (DeFi) on a public blockchain.
Developed in Three Hubs
Project Mariana was developed by three BIS Innovation Hub centers in Singapore, the Eurosystem, and Switzerland together with the Banque de France, the Monetary Authority of Singapore (MAS), and the Swiss National Bank (SNB). A feasibility study successfully tested cross-border trading and settlement between simulated financial institutions with hypothetical wCBDCs denominated in francs, euros, and Singapore dollars.
The process was based on three elements in which a common technical token standard of a public blockchain to enable exchange and interoperability between the different currencies was used.
Another is creating bridges for seamless transfer of wCBDC between different networks, and finally creating an Automated Market Maker (AMM), a specific decentralized market form, for automated trading and settlement of spot currency transactions.
Experimental in Nature
Project Mariana is purely experimental and shouldn't be interpreted as an indication the partner central banks intend to issue wCBDC, nor that they endorse DeFi or any particular technology, the SNB says of the initial collaboration among several Innovation Hub centers.
«In a potential future with tokenized assets, safe and efficient pricing and exchange mechanisms for cross-currency transactions remain essential. Project Mariana demonstrates the feasibility of such an infrastructure in an innovative way,» said Thomas Moser, deputy member of the SNB's Governing Board.
