The Bank for International Settlements (BIS) Innovation Hub has outlined an ambitious agenda for the upcoming year, focusing on innovative projects that enhance collaboration among central banks. This includes exploring the use of multiple wholesale central bank digital currencies (CBDCs) for cross-border payments and developing a distributed ledger technology (DLT) prototype for the issuance of tokenized green bonds targeted at retail investors.
Established in 2019, the BIS Innovation Hub has expanded its presence with centers in Switzerland, Hong Kong, and Singapore, along with plans for additional locations in Toronto, London, Frankfurt, Paris, and Stockholm.
In the coming year, the Hub will concentrate on six pivotal areas to promote cooperation in financial technology. These areas include supervisory technology (suptech) and regulatory technology (regtech), next-gen financial market infrastructures, CBDCs, open finance, cybersecurity, and green finance.
Key initiatives already in development feature a proof of concept that uses multiple wholesale CBDCs to assess the potential for more economical and rapid cross-border payment solutions. Additionally, a DLT-based tokenized green bond program is in the works.
The Hub is also set to create a proof of concept for a regulatory reporting platform that leverages data analytics and visualization tools, offering supervisors enhanced, timely insights into risk management. Furthermore, research projects focusing on tiered retail CBDC distribution architectures will be pursued.
Benoît Cœuré, head of the BIS Innovation Hub, emphasized the organization’s commitment to utilizing technology pragmatically for central banks, aiming to generate public goods that enhance the global financial system.
In conjunction with these efforts, the Hub has initiated an innovation network designed to foster knowledge sharing and collaborative problem-solving among its member central banks. All 63 member central banks were invited to participate in the inaugural meeting of this network.