Yesterday, the IMF published a paper building on last year’s proposal for XC, a platform to create a global centralized ledger for cross-border payments. The platform would allow commercial banks and other payment providers to participate alongside central banks and likely forgo the need for multiple wholesale central bank digital currency (CBDC) projects. Although a distributed ledger (DLT) would be possible, it could also use a centralized database.
“This is an evolution of wholesale CBDC, which is both a settlement asset and infrastructure—a platform, really,” the report notes. As we reported last year, an XC platform would not only centralize payments and settlement but also provide a foreign exchange (FX) market, hedging and compliance.
Tobias Adrian, Director of the Monetary and Capital Markets Department at the IMF and one of the paper’s authors, recently compared the XC to a “digital town square”.
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