In partnership with the New York Federal Reserve, multiple central banks from Europe, Korea, and Japan, and the New York Federal Reserve, forty of the largest commercial banks in the world have joined the Agora project, a new digital currency pilot. The initiative’s goal is to investigate how to enhance cross-border payment systems through the use of tokenized bank deposits and central bank digital currencies (CBDCs). It concentrates on “wholesale” CBDCs, or those that are exchanged between banks.
The project will address the legal frameworks, regulatory and technological systems that vary, time zone variances, and other challenges associated with cross-border transactions. Participating major banks include Japan’s MUFG, JPMorgan, HSBC, and UBS.
Agora is not the same as Bridge, another CBDC initiative under the direction of the Bank for International Settlements and the Institute of International Finance. Saudi Arabia, the UAE, Thailand, Hong Kong, and China are among the central banks involved.