BIS studies how tokenisation can help central banks improve monetary policy
The Bank for International Settlements' innovation hub is studying how tokenisation can help central banks improve monetary policy operations, by building new liquidity channels in shorter time and reducing compliance costs through automation, an official said at Hong Kong FinTech Week.
The Bank for International Settlements (BIS) is studying how tokenisation can help central banks improve monetary policy operations, an official said at the Hong Kong FinTech Week.
Tommaso Mancini-Griffoli, head of the BIS Innovation Hub (BISIH), the BIS unit responsible for promoting financial technology, said the BISIH is researching how tokenisation can enable central banks to build new liquidity channels in a shorter time, which is especially important during periods of market volatility.
The hub is also examining how to reduce compliance costs by using tokenisation to automate compliance, Mancini-Griffoli added.
Speaking at the Hong Kong FinTech Week, he said challenges such as governance and risk management would take time to resolve.
He cited the BIS's cross-border payment project Nexus, which aims to connect fast payment systems and involves cooperation with several Asian countries, as an example. The project took about one year to test the technical solutions and another year to develop governance arrangements and other related matters, he said.