According to CoinDesk, Project Agorá, a new initiative announced by the Bank for International Settlements (BIS), aims to explore the integration of tokenized commercial bank deposits with tokenized wholesale central bank money. The project involves seven central banks from the U.K., Japan, Korea, Mexico, Switzerland, New York, and Europe. The BIS, which represents 63 of the world's central banks, is currently running several projects focused on the issuance of national digital currencies and enhancing market efficiency with technologies that power crypto networks.
Tokenization, the process of digitizing real-world assets, is gaining serious consideration from financial service providers worldwide. A recent U.K. government-backed report encouraged local firms to implement their tokenization strategies. Last month, HSBC announced it was tokenizing gold for investors in Hong Kong. In March, the market value of U.S. Treasury notes tokenized on public blockchains exceeded $1 billion for the first time, as per data from 21.co.
Project Agorá, named after the Greek word for marketplace, will unite seven monetary authorities from the U.K., Japan, South Korea, Mexico, Switzerland, New York, and Europe, along with private financial firms. The project aims to investigate the seamless integration of tokenized commercial bank deposits with tokenized wholesale central bank money on a public-private programmable core financial platform. This could enhance the functioning of the monetary system and provide new solutions using smart contracts and programmability while maintaining its two-tier structure.
Cecilia Skingsley, Head of the BIS Innovation Hub, stated that Project Agorá will explore a more efficient payment infrastructure that could consolidate numerous payment systems. The project will not only test the technology but also its operational, regulatory, and legal conditions within the participating currencies, alongside financial companies operating in them. Hyun Song Shin, BIS head of research, expressed optimism about the project's ambitious goal, stating that they aim to build on the current infrastructure to create a usable solution that will make a real difference. The BIS plans to issue a call to gather expressions of interest from private financial institutions to join Project Agorá.
