On 26 September 2022, the BIS Innovation Hub and four central banks - the People's Bank of China (PBOC), the Hong Kong Monetary Authority (HKMA), the Bank of Thailand (BoT), and the Central Bank of the UAE (CBUAE) - announced the completion of a pilot phase for Project mBridge, a multi-CBDC platform designed for cross-border payments.
What mBridge Demonstrated
The mBridge pilot was notable for moving beyond theoretical research into real-value transactions. During a six-week pilot period, 20 commercial banks from the four participating jurisdictions executed over 160 cross-border payment and foreign exchange transactions totaling approximately USD 22 million in value.
The platform settled transactions in seconds rather than the days typically required for correspondent banking. Participating banks could transact directly using wholesale CBDCs issued by each of the four central banks on a shared distributed ledger platform.
Technical Architecture
mBridge was built on a custom blockchain - the mBridge Ledger - developed specifically for the project. Unlike public blockchains, the mBridge Ledger was permissioned and governed by the participating central banks. Each central bank could issue and redeem its own CBDC on the shared platform, and commercial banks could hold and transfer these CBDCs to settle cross-border obligations.
The platform included privacy features ensuring that transaction details were only visible to the parties involved and their respective central banks, not to all participants on the network.
Significance and Later Developments
Project mBridge was one of the most advanced multi-CBDC experiments globally and received significant attention from the international policy community. It demonstrated that a shared ledger approach could dramatically reduce the cost, time, and complexity of cross-border payments.
However, the project also attracted geopolitical scrutiny. Some observers noted that a platform enabling cross-border settlement without relying on the US dollar-dominated correspondent banking system could have implications for sanctions enforcement. In October 2024, the BIS withdrew from the project, handing governance to the member central banks.
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