On September 28, central banks from France, Singapore, and Switzerland, in collaboration with the Bank for International Settlements (BIS), conducted a successful trial of cross-border trading using wholesale central bank digital currencies (wCBDCs). This trial not only demonstrated the potential of decentralized financial technologies but also provided insights into the future of interbank foreign exchange in a world increasingly adopting CBDCs.

The trial, known as Project Mariana, utilized decentralized finance (DeFi) concepts and a public blockchain to enable seamless interoperability and exchange between currencies. It employed a common token standard and bridges to facilitate the smooth transfer of wCBDCs across different networks. Automated market makers (AMMs) were also used to enable instant pricing, execution, and settlement of spot FX transactions.

The objective of the test was to simulate a scenario where three central banks, using hypothetical euro, Singapore dollar, and Swiss franc wCBDCs, conducted transactions on a unified platform. Project Mariana provided valuable insights into the potential future of foreign exchange settlement as more central banks adopt CBDCs, particularly in streamlining cross-border payments, which have historically been complex.

While the successful trial highlights the advantages of integrating DeFi elements, such as AMMs, into financial infrastructures, it is important to note that tokenization and DeFi technologies are still in their early stages. Further exploration and research are necessary before such systems become commonplace.

The success of Project Mariana suggests that DeFi elements, particularly AMMs, could form the foundation of future financial infrastructures. The use of smart contracts allowed central banks to efficiently manage their wCBDCs without directly engaging with the underlying platform.

Cecilia Skingsley, the Head of the BIS Innovation Hub, emphasized the significance of the project’s success, stating that Project Mariana pioneers the use of innovative technology in interbank foreign exchange markets. She highlighted the feasibility of exchanging wholesale CBDCs across borders using groundbreaking concepts like AMMs.

As CBDCs gain global traction, tests like Project Mariana will play a crucial role in shaping the digital financial landscape of the future.