The BIS Innovation Hub has unveiled its 2023 work program. This includes previously unannounced projects on stablecoins, DeFi and CBDC.
Project Pyxtrial at the London Centre will monitor stablecoins to ensure that the backing assets at least match the stablecoin issuance. Pyxtrial plans to explore a variety of tools to enable supervisors and regulators to monitor stablecoin systems. The project’s name is based on the Trial of the Pyx, a historical UK process where minted coins were tested to ensure they met specifications. Nowadays, that’s done in a laboratory, but there are still occasional ceremonies.
To date the BIS Innovation Hub has launched 26 projects, of which 21 are still active. Fifteen of the projects focused on central bank digital currency (CBDC). Three cross border CBDC projects have concluded, including Project Helvetia, Jura and Dunbar, leaving MBridge as the main project still exploring the topic for wholesale cross border CBDC and Icebreaker for retail CBDC.
Two CBDC ongoing projects have been fairly under the radar so far. They are Polaris for offline CBDCs out of the Nordic center and Titus in Switzerland. Titus was launched last year to trial an in-house blockchain testing solution, as well as liquidity savings mechanisms that we suspect may use DeFi, but limited details are available.
Another DeFi solution involves an automated market making for foreign exchange being trialed as part of Project Mariana. And there’s Project Atlas to monitor public blockchain DeFi and cryptocurrency systems.
Blockchain was also used in multiple Hong Kong green bond trials as part of Project Genesis, which has now concluded.