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The Bank for International Settlements has outlined how tokenization technology could meaningfully improve wholesale cross-border payments — one of the most friction-heavy, cost-intensive layers of the global financial system. The BIS argument centres on programmable settlement: tokenized assets and liabilities settling on shared ledgers can collapse the multi-day correspondent-banking chain into near-instant finality.
The BIS has been a consistent voice in this space, running experiments under its Innovation Hub — including Project mBridge, which tested multi-CBDC settlement rails across four central banks. The latest framing reinforces that institutional interest in tokenized infrastructure is moving from research to policy recommendation.
Frequently asked questions
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What are the potential benefits of tokenization for cross-border payments?
Tokenization can reduce friction and costs in wholesale cross-border payments by enabling near-instant settlement on shared ledgers, thus collapsing the lengthy correspondent-banking chain.
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How has the BIS been involved in exploring tokenization technology?
The BIS has conducted experiments through its Innovation Hub, including Project mBridge, which tested multi-CBDC settlement rails among four central banks.
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