The Monetary Authority of Singapore announced on Thursday that it has successfully concluded Project Mariana—in partnership with central banks of France, Switzerland and the Bank of International Settlements (BIS). The project sought to test out whether it was possible to conduct cross-border trading using wholesale central bank digital currencies (wCBDCs).
Behind the development of the so-called Project Mariana were three BIS Innovation Hub centers (the Swiss, Singapore and Eurosystem Hub Centres)—along with the Banque de France, the Monetary Authority of Singapore, and the Swiss National Bank, according to a press release.
In order to test the cross-border trading and settlement, the project’s proof of concept used a hypothetical euro, Singapore dollar and Swiss franc wCBDCs between financial institutions leveraging decentralized finance (Defi) technology concepts on a public blockchain.
The project relied on “a common token standard on a public blockchain which facilitates interoperability and seamless exchange of wCBDC across varied local payment and settlement systems maintained by participant central banks.”
In recent months, several countries across Europe and Asia have expressed interest in issuance of a wholesale CBDC – which enables the settlement of interbank transfers. Amid growing interest in wholesale CBDC, Project Mariana sought to investigate how overseas and exchange settlement would work in a world where central banks have launched their own CBDCs.
“Project Mariana pioneers the use of novel technology for interbank foreign exchange markets. It successfully demonstrated that it is feasible to exchange wholesale CBDC across borders using novel concepts such as automated market makers (AMM),”Head of the BIS Innovation Hub Cecilia Skingsley said.
Project Mariana reportedly used smart contracts, which allowed central banks to manage their wCBDC without having to directly operate or control the underlying platform. “DeFi (decentralized finance) elements tested in the project, specifically automated market makers, could form the basis for a new generation of financial market infrastructures,” Singapore’s central bank said in the press release.
It is crucial to acknowledge that the BIS has been spearheading the promotion of cross-border CBDCs, having lined up several pilot tests across the world. Earlier this month, the BIS, along with central banks of Hong Kong and Israel, unveiled the results of Project Sela. Meanwhile, Hong Kong Monetary Authority CEO Eddie Yue recently said that project mBridge is set to undergo significant expansion.