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BIS releases unified-ledger proposal for cross-border, tokenized asset transactions

Press Releases Crypto News Cointelegraph BIS releases unified-ledger proposal for cross-border, tokenized asset transactions

The Bank for International Settlements (BIS) has released a chapter of its annual report early. That chapter, on the future of the monetary system, discusses “a new type of financial market infrastructure — a unified ledger.” The chapter was published June 20, one day after the International Monetary Fund (IMF) released a paper describing its “single ledger” cross-border payments concept.

The BIS proposal harnesses central bank digital currency and tokenized assets into “a new type of financial market infrastructure” — that is, the unified ledger, which would be powered by application programming interfaces (APIs). The authors of the proposal critiqued existing financial technology. They said:

“The collapse of crypto and the faltering progress of other tokenisation projects underline a key lesson. The success of tokenisation rests on the foundation of trust provided by central bank money and its capacity to knit together key elements of the financial system.”

One drawback of current tokenization schemes is that they exist in silos, the proposal claimed. A unified ledger would incorporate the ledgers of the counterparties, programmed reconciliation and messaging, enabling faster transactions and atomic (simultaneous) settlement in a “partitioned data environment” where privacy and transparency are controlled.

A unified-ledger system would allow for considerable disintermediation in transactions with securities. Cross-border transactions would require more coordination, assuming an intermediated system with the presence of both central banks and private payment service providers.

BIS general manager Agustín Carstens Go to Source to See Full Article
Author: Derek Andersen

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