According to CoinDesk, more than 40 financial firms will join the Bank for International Settlements (BIS) to explore how tokenization can enhance wholesale cross-border payments in Project Agorá. The initiative aims to combine wholesale central bank money with tokenized commercial bank deposits, the BIS announced on Monday.
The financial firms were selected by the BIS following a public call for participation in May. Project Agorá will now enter its design phase, focusing on the digitization of real-world assets. Tokenization, a technology several countries are exploring, is at the core of this project. The BIS launched Project Agorá in April, bringing together seven monetary authorities from the U.K., Japan, South Korea, Mexico, Switzerland, the U.S., and Europe.
The project builds on the BIS's unified ledger concept and aims to investigate how tokenized commercial bank deposits can be seamlessly integrated with tokenized wholesale central bank money in a public-private programmable core financial platform. This major public-private partnership seeks to address several structural inefficiencies in current payment systems, particularly in cross-border transactions.
The BIS highlighted the challenges for cross-border payments, including different legal, regulatory, and technical requirements, as well as varying operating hours. Project Agorá aims to overcome these obstacles and improve the efficiency of international payments.
