The global financial market is undergoing a major transformation in payment infrastructure. As cross-border trade, international investment, and global supply chains continue to grow, cross-border payments have become a critical component supporting the global economy. However, most current payment systems are built on financial architectures developed decades ago. With rapidly rising transaction volumes, the emergence of digital finance, and increasing demand for global capital flows, traditional payment models are facing growing challenges in efficiency, cost, and information transparency.
Recently, Tokenized Finance, blockchain, and Distributed Ledger Technology (DLT) have become key focus areas for central banks and financial institutions around the world. A growing body of research is examining whether new technologies can be used to redesign payment processes while maintaining financial stability and regulatory requirements, making capital flows more instantaneous, secure, and transparent. In this context, Project Agorá was launched. Jointly promoted by the Bank for International Settlements (BIS) and the Institute of International Finance (IIF), this research project is not only a test of new payment technology but also an experiment in how the global financial payment ecosystem should collaborate in the future. Participants include multiple central banks, commercial banks, and other regulated financial institutions, underscoring that the project’s goal is not to build a single platform but to create new infrastructure that connects diverse financial actors. To truly understand Project Agorá’s value, it’s essential to view it not only from a technical perspective, but also within the broader global financial payment ecosystem, observing how financial institutions collaborate to drive ongoing evolution in cross-border payment systems.
Why is the global financial payment ecosystem moving toward tokenization?
For decades, the global payment system has operated through a framework involving central banks, commercial banks, and payment clearing institutions. This system, developed over many years, is highly stable and supports the day-to-day operations of international financial markets. However, as cross-border payment demands surge, the traditional framework faces new challenges. Each country has its own payment systems, clearing rules, and business hours. Completing an international transaction often requires multiple intermediaries, resulting in delays, higher payment costs, and increased liquidity management pressures.
At the same time, the global financial market is moving toward 24/7 operations. Digital asset markets already enable round-the-clock trading, and businesses and financial institutions now expect payment systems to provide more instantaneous, transparent cross-border capital flow capabilities. Tokenized Finance has gained attention in this environment. By representing financial assets as digital tokens and using shared ledgers for transactions and settlements, information exchange between markets can become immediate, and payment processes can be greatly simplified. Importantly, Project Agorá’s tokenization is not about creating new currencies but digitizing existing financial assets so that current financial systems can operate on new technological foundations. It is, therefore, more of an upgrade to global payment infrastructure than a wholesale creation of a new financial system.
What role does BIS play in global financial infrastructure?
(Source: BIS_org)
Within Project Agorá, the Bank for International Settlements (BIS) serves as both coordinator and research leader. BIS is recognized as a key platform for global central bank cooperation, with a core mission of facilitating communication and collaboration among central banks on financial stability, payment systems, and regulatory matters. When new technologies or institutional changes arise in financial markets, BIS typically evaluates their practical value through research projects, experimental platforms, and international partnerships.
Project Agorá is a prime example of BIS’s commitment to advancing Tokenized Finance research. Unlike previous tests that focused on digital currencies within single countries, Project Agorá spans multiple jurisdictions, emphasizing cross-border collaboration, joint governance, and payment interoperability.
BIS does not directly offer payment services or act as a commercial bank. Its goal is to create a research framework that encourages discussion and validation across countries, helping central banks and financial institutions jointly explore the future of payment infrastructure. From a broader perspective, Project Agorá is more than a technical experiment—it reflects BIS’s aim to maintain the security, interoperability, and consistency of payment systems throughout global financial innovation.
Why are central banks the core participants in Project Agorá?
Central banks are integral to Project Agorá because they control the core functions of national monetary systems and payment infrastructure. In modern finance, central banks provide central bank money, maintain financial stability, manage payment and clearing systems, and ensure the proper functioning of financial markets. Any major reform to payment infrastructure requires central bank involvement.
Project Agorá does not seek to diminish the central bank’s role; rather, it aims to tokenize central bank reserves, maintaining them as the most creditworthy assets within the payment architecture. This ensures that, even as payment processes adopt new blockchain technology, transactions remain anchored to existing fiat currency systems. Furthermore, cross-border payments involve different currencies and legal frameworks, making unified payment standards and governance difficult without central bank collaboration. The cooperation of multiple central banks is thus fundamental to advancing cross-border payment research through Project Agorá. Central banks are not just participants—they are the key pillars supporting the stability of the payment ecosystem.
What role do commercial banks play in Project Agorá?
While central banks supply the foundational payment currency, most business and consumer financial services are delivered by commercial banks. Project Agorá does not alter the two-tier banking system; instead, it allows commercial banks to remain essential payment service providers. In Project Agorá’s framework, commercial banks handle customer funds, initiate payment transactions, manage liquidity, and participate in shared ledger transactions. They continue to be critical gateways for cross-border payments, international trade settlements, and financial services, with underlying payment infrastructure increasingly supported by tokenization and shared ledger technology.
This approach has two key benefits. First, it avoids excessive disruption to the existing financial market structure. Businesses and investors can continue to use familiar banks for payments, without needing to directly engage with new underlying technology. Second, commercial banks can continue to leverage their strengths in customer service, risk management, and financial innovation, offering a broader range of financial services within the new payment architecture rather than being replaced by technology. Project Agorá aims to establish a collaborative model in which “central banks provide the trust foundation, commercial banks deliver financial services, and shared ledgers enhance payment efficiency,” rather than redefining institutional roles.
How does Tokenized Finance connect central banks, commercial banks, and financial markets?
Project Agorá’s value goes beyond speeding up cross-border payments. It seeks to establish a collaborative framework connecting diverse financial participants. In this framework, Tokenized Finance is not an isolated system but a vital medium linking central banks, commercial banks, and financial markets, integrating payment, settlement, and liquidity management processes that were previously siloed.
Traditionally, financial institutions maintain their own ledgers and information systems. Completing a cross-border transaction often involves repeated data exchanges among banks, clearing institutions, and payment systems, leading to delays, redundancy, and rising operational costs as transaction volumes grow.
Project Agorá aims to streamline these processes through a Unified Ledger. Central banks provide tokenized reserves as a reliable settlement foundation, commercial banks use tokenized deposits for capital flows, and the shared ledger synchronizes transaction information and updates account statuses. This design allows financial actors to retain their existing responsibilities while completing payments and settlements on a common infrastructure. Viewed holistically, Tokenized Finance acts as a new collaborative language, not a new financial system. It enables institutions to exchange information, execute transactions, and settle funds under unified standards, reducing friction from cross-system communication and laying the groundwork for future financial innovation.
Project Agorá is often compared to Wholesale Central Bank Digital Currency (Wholesale CBDC) and Real-Time Gross Settlement (RTGS) systems, but their purposes are distinct.
RTGS is the large-value payment infrastructure used by most central banks, facilitating high-value settlements among financial institutions. This system is secure, stable, and an indispensable foundation of modern financial markets. Wholesale CBDC, actively researched by central banks, involves providing central bank money in digital form to financial institutions, enhancing payment efficiency and interoperability in wholesale markets.
Project Agorá builds upon these research foundations. It is not simply a digital currency experiment; it explores how tokenized central bank reserves, shared ledgers, and cross-border collaboration can enable financial institutions across jurisdictions to jointly complete payments and settlements. Project Agorá’s focus is not just on “digitizing money,” but on “redesigning global financial infrastructure after digitization.” It is an exploration of payment architecture as a whole, not the development of a single payment tool.
How does Project Agorá differ from stablecoin payments?
As stablecoins become more common in cross-border payments, the differences between Project Agorá and stablecoin payment models are increasingly relevant. Both aim to use digital assets and blockchain technology to improve payment efficiency and reduce cross-border transfer times, but their design philosophies and governance structures differ.
Project Agorá is built on central bank reserves and commercial bank deposits, maintaining the existing fiat currency system and two-tier banking structure. Central banks provide the trust foundation, and commercial banks handle capital services and customer relationships, emphasizing financial stability and regulatory consistency. Stablecoins, issued by private institutions and typically backed by fiat or other assets, vary in operating models, governance, and regulatory frameworks depending on the issuer. Some stablecoins are used in cross-border payments, corporate settlements, and on-chain finance, but must adapt to local regulatory regimes. Project Agorá and stablecoins are not substitutes—they represent two distinct directions for payment infrastructure. Project Agorá focuses on upgrading public financial infrastructure, while stablecoins reflect private sector innovation.
Why is Real-Value Testing an important milestone?
Before any new financial infrastructure is deployed, it must be thoroughly tested and validated. Project Agorá has entered the Real-Value Testing phase, moving from proof-of-concept to real transaction environments. This milestone is significant because testing now includes real capital flows and financial operations, not just simulated transactions.
The research team is evaluating not only payment efficiency, but also liquidity management, transaction finality, information security, data governance, and cross-border collaboration. Since global payment systems involve numerous institutions and jurisdictions, any technological innovation must address efficiency, security, and regulatory requirements.
Real-Value Testing is also crucial for helping participating institutions determine whether tokenized payments can be integrated with existing financial systems, rather than requiring independent new platforms. The results will guide future decisions about the adoption of related technologies.
What are Project Agorá’s implications for future global financial infrastructure?
Although still in the research phase, Project Agorá’s design reflects important trends in global financial markets. First, cross-border payments are moving toward real-time settlement. As businesses and supply chains depend more on rapid capital flows, payment systems will evolve beyond traditional banking hours to 24/7 operations. Second, payment, settlement, and compliance processes will become increasingly integrated. Shared ledgers and standardized data exchange will reduce redundant work, boost payment efficiency, and enhance regulatory transparency. Third, Tokenized Finance may become a key technology for future financial infrastructure, improving efficiency not only in cross-border payments but also in securities settlement, bond issuance, asset tokenization, and other services. Finally, Project Agorá highlights the growing importance of cross-border cooperation in financial innovation. Because cross-border payments involve multiple currencies, regulations, and markets, no single country can implement all reforms alone. Collaboration among central banks, commercial banks, and international financial institutions is essential for building interoperable global payment infrastructure.
Summary
Project Agorá is more than a tokenized payment research initiative—it represents a new collaborative model for the global financial payment ecosystem. By involving central banks, commercial banks, and international financial institutions, the project aims to maintain the stability of existing financial systems while leveraging tokenization and shared ledger technology to improve cross-border payment efficiency. Project Agorá does not seek to replace established financial actors, but to redefine collaboration among institutions. Central banks provide the trust foundation, commercial banks manage financial services and capital flows, and new payment infrastructure enables more efficient transactions and settlements. As global payment demand grows, expectations for instant settlement, round-the-clock payments, and cross-border interoperability will continue to rise. The Project Agorá framework not only provides a testing ground for Tokenized Finance, but also offers valuable insights into the evolution of global financial infrastructure.
FAQ
Q1: What role does Project Agorá play in the global financial payment ecosystem?
Project Agorá, jointly promoted by the Bank for International Settlements (BIS) and multiple central banks, aims to build more efficient and interoperable cross-border wholesale payment infrastructure using Tokenized Finance and shared ledger technology.
Q2: Why must both central banks and commercial banks participate in Project Agorá?
Central banks provide the trust foundation and financial stability for payment systems, while commercial banks deliver payment services to businesses and financial markets. Project Agorá preserves the two-tier banking system, enabling both to collaborate under a new tokenized framework to enhance cross-border payment efficiency.
Q3: How does Project Agorá differ from Wholesale CBDC?
Wholesale CBDC focuses on digitizing central bank money, while Project Agorá takes a broader approach by combining tokenized central bank reserves, commercial bank deposits, and shared ledgers to build a comprehensive cross-border payment and settlement framework.
Q4: Does Project Agorá mean global payment systems will all use blockchain in the future?
Project Agorá is still in the research and Real-Value Testing phase, aiming to determine whether tokenization and shared ledgers can improve cross-border payment efficiency. Future adoption will depend on regulatory policies, technology maturity, and market demand.
