- Project Mariana tested cross-border trading and settlement of wholesale CBDCs.
- Successfully traded and settled hypothetical Euros, Singapore Dollars and Swiss Francs.
- The DeFi elements tested in the project, particularly automated market makers, could form the basis of a new generation of financial market infrastructure.
The Bank for International Settlements (BIS) and the central banks of France, Singapore and Switzerland carried out the Mariana project. The project tested cross-border trading and wholesale settlement of central bank digital currencies (wCBDCs) between financial institutions, using new technological concepts of decentralized finance (DeFi) on a public blockchain.
The Mariana project was jointly developed by three BIS Innovation Hubs (the Swiss, Singapore and Eurosystem Hubs) in collaboration with the Banque de France, the Monetary Authority of Singapore and the Swiss National Bank.
The project’s proof of concept successfully tested cross-border trading and settlement of hypothetical wCBDCs in Euros, Singapore Dollars and Swiss Francs between simulated financial institutions. The process was based on three elements:
- A common technical token standard provided by a public blockchain to facilitate exchange and interoperability between different currencies.
- Bridges for the transparent transfer of wCBDCs between different networks.
- An automated market maker (AMM), which is a specific type of decentralized exchange for automatically trading and settling spot foreign exchange transactions.
For Project Mariana, AMM pooled the liquidity of hypothetical Euro, Singapore Dollar and Swiss Franc wCBDCs with innovative algorithms to price, auto-execute and immediately settle spot FX transactions . These protocols could be used by the next generation of financial market infrastructures facilitating cross-border trading and settlements between financial institutions.
Project Mariana’s architecture balances the national need for supervision and autonomy of central banks with the interest of financial institutions to efficiently hold, transfer and settle wCBDCs across borders. This is achieved through the use of a common token standard on a public blockchain that facilitates interoperability and seamless exchange of wCBDC between various local payment and settlement systems operated by participating central banks. As such, Mariana offers possible approaches to consider an international dimension in current explorations of wCBDC design.
As tokenization and DeFi technologies are still nascent, additional research and experimentation is needed. The BIS Innovation Hub and its global partners will continue to explore their benefits and challenges based on relevant use cases.
The Mariana project is pioneering the use of new technologies for interbank foreign exchange markets. It has successfully demonstrated that it is possible to trade wholesale CBDCs across borders using new concepts such as automated market makers. Bringing together a diverse team of software engineers, policy and currency experts across three Innovation Hubs and central banks has been key to this success.
Cecilia Skingsley, Head of BIS Innovation Center
Project Mariana is purely experimental and does not indicate that any of the partner central banks intend to issue wCBDCs or endorse DeFi or any particular technology solution. This is the first transversal project of the Innovation Hub.