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Payments General

Central Banks of Canada and Singapore successfully trial DLT for cross border payments

Thursday 2 May 2019 | 09:46 AM CET

The Bank of Canada and the Monetary Authority of Singapore (MAS) have conducted a successful experiment on cross-border payments using Distributed Ledger Technology.

This is the first such trial between two central banks, and has great potential to increase efficiencies and reduce risks for cross-border payments, according to the official press release. The two central banks have successfully linked up their respective experimental domestic payment networks, namely Project Jasper and Project Ubin, which are built on two different DLT platforms.

The project teams used a technique called Hashed Time-Locked Contracts (HTLC) to connect the two networks and allow Payment versus Payment (PvP) settlement without the need for a trusted third party to act as an intermediary. The Jasper-Ubin project was carried out in partnership with Accenture and J.P. Morgan, who supported the development of the Canadian network on Corda, and the Singapore network on Quorum, respectively.

Following the successful conclusion of the project, the Bank of Canada and MAS have jointly published a report that proposes different design options for cross-border settlement systems. The report further suggests areas of research in DLT interconnectivity mechanisms and alternative network models.

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