The Bank for International Settlements said a tokenization prototype under its Project Agorá initiative has demonstrated the possibility of atomic settlement in wholesale cross-border transactions.

BIS and the Institute of International Finance convened Project Agorá, a public-private collaboration launched to address inefficiencies in such wholesale cross-border payments. The initiative focuses on settlement delays, counterparty risk, and operational friction in multi-currency transactions, according to the BIS.

In a report on Wednesday, BIS said the prototype used a layered architecture that allows central banks to retain operational autonomy while interacting through a shared interoperable platform. The report also found that atomic settlement, defined as “all-or-nothing” execution of transaction chains, is achievable across multiple currencies and jurisdictions. 

It added that legal analysis concluded settlement finality can be reached across all seven participating jurisdictions, though further work is required on technical, operational, and contractual design aligned with national legal frameworks.

On privacy, BIS said it can be safeguarded at both balance and transaction levels using technologies that shield sensitive data while maintaining regulatory compliance.

"The modular design can unlock new capabilities, including conditional and always-on payments, while enabling future enhancements in areas such as anti-money laundering, countering the financing of terrorism, sanctions compliance, and fraud detection, as regulatory and data-sharing frameworks evolve," BIS wrote in a statement.

Project Agorá initially involved the Federal Reserve Bank of New York, the Bank of England, the Bank of France, the Bank of Japan, the Bank of Korea, the Bank of Mexico, and the Swiss National Bank, alongside a group of more than 40 private sector financial institutions. Moving forward, the Bank of Canada will formally join the consortium as the eighth central bank participant.

BIS noted that project participants will next advance to real-value testing involving selected currencies, with future work including an enhanced role for the private sector and continued engagement from the central banks.