Major Banks and Companies Unite for Blockchain-Based Payment Revolution

On September 16, 2024, the Bank for International Settlements (BIS) announced the participation of over 40 private companies in the Agorá project, including major players like JPMorgan Chase, Deutsche Bank, Visa, and Mastercard.

Initiated in May 2024, this blockchain-focused project aims to enhance cross-border wholesale payment processes.

The Institute of International Finance (IIF) has brought these private firms together to work alongside seven central banks, including the Federal Reserve, the Bank of England, and the Bank of Japan.

The Agorá initiative is centered on the tokenization of financial assets, which involves transforming them into digital tokens on a blockchain. This approach is intended to improve the speed, transparency, and security of payments.

The project seeks to create a unified ledger that merges tokenized commercial bank deposits with central bank digital currencies (CBDCs), potentially streamlining international transactions and mitigating risks.

Contributions from private sector experts in blockchain and international payments will support the development of a programmable platform that incorporates tokenized assets and employs smart contracts for automated settlements, which could lower transaction costs.

BIS anticipates releasing a comprehensive report by the end of 2025, detailing the project’s design, regulatory challenges, and a technical prototype, which could lead to a future global payment system utilizing blockchain technology.