BIS Project Agorá Finds Tokenization Could Speed Cross-Border Payments

TLDR

• BIS Project Agorá tested tokenized central bank reserves and commercial bank deposits for cross-border payments.
• The project involved seven central banks and more than 40 private financial institutions.
• The prototype showed tokenization could support faster settlement and reduce reconciliation delays.
• Project Agorá uses atomic settlement, where all parts of a transaction complete together or none do.
• The next phase will test real-value transactions with selected currencies and institutions.

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The Bank for International Settlements said Project Agorá has shown that tokenization could improve cross-border payments by reducing settlement delays, reconciliation work, and operational risk between banks.

The project brought together the BIS, seven central banks, and more than 40 private financial institutions to test how tokenized central bank money and commercial bank deposits could work across borders. Participants included the Federal Reserve Bank of New York, Bank of England, Bank of Japan, Swiss National Bank, Banque de France on behalf of the Eurosystem, Bank of Korea, and Bank of Mexico.

The Bank of Canada has now joined the initiative, while more financial institutions are expected to participate in the next stage. Project Agorá is still experimental, and there is no confirmed timeline for a full production launch.

Tokenized Money Tested for Cross-Border Settlement

Project Agorá examined whether tokenized central bank reserves and tokenized commercial bank deposits could support faster and more reliable wholesale payments across currencies and jurisdictions.

The report found that tokenization could help address several long-running problems in cross-border payments. These include slow settlement, fragmented compliance checks, limited visibility into payment status, and settlement risk when funds move through multiple intermediary banks.

Today, international transfers can pass through several correspondent banks before reaching the final recipient. This process can take days and often requires manual reconciliation between institutions.

The Agorá prototype showed that tokenized payment systems could settle transactions in seconds once funds are locked. It also showed that compliance checks could happen in parallel rather than step by step, which may reduce delays.

A central feature of the project is atomic settlement. This means all parts of a transaction are complete together or none of them are complete. In cross-border payments, this can reduce the risk that one side of a payment succeeds while another side fails.

Two-Layer Model Preserves Central Bank Control

The project uses a two-layer architecture. Tokenized commercial bank deposits sit on a shared unifying ledger where participants coordinate payment workflows. Tokenized central bank reserves remain on separate jurisdictional ledgers operated under each central bank’s authority.

This design was chosen because central banks wanted to retain local control over their own currency systems. The unifying ledger coordinates the payment process, but it does not directly control actions on the central bank ledgers.

This model differs from some other cross-border payment experiments, including mBridge, which explored shared ledger models involving central bank digital money.

The Agorá design focuses on wholesale financial market use rather than retail users. The platform is not intended for public consumer access. Its purpose is to test whether banks and financial institutions can move tokenized deposits and central bank money more efficiently within a regulated framework.

Private-sector participants included large banks and financial companies such as JPMorgan, HSBC, Deutsche Bank, Swift, Mastercard and UBS. Their involvement reflects growing market interest in using tokenized infrastructure for payment, settlement and liquidity management.

Real-Value Testing Comes Next

Project Agorá will now move from simulation toward real-value testing with selected currencies and institutions. This means actual money will be used in controlled tests rather than only prototype balances.

The BIS said the project remains in a research and testing phase. Any wider rollout would require further technical work, regulatory agreement, and central bank approval.

The findings come as tokenization gains traction across financial markets. DTCC is preparing tokenized settlement infrastructure for stocks, ETFs, and U.S. Treasuries, while Nasdaq and Intercontinental Exchange are also developing blockchain-based systems for tokenized securities.

The BIS has been active in tokenization research as central banks and financial firms assess how money and securities could move across digital ledgers. At the same time, the BIS has warned that privately issued stablecoins may create financial risks if they are not properly regulated.

Project Agorá places central bank money and commercial bank deposits at the center of tokenized payment design. Its next phase will test whether the prototype can support real transactions while preserving regulatory control, settlement safety and bank-level compliance requirements.

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