Three central banks advance digital assets in cross-border finance

The Hong Kong Monetary Authority (HKMA) has launched partnerships with the Bank of Thailand (BOT) and Brazil’s Banco Central do Brasil (BCB) to enhance cross-border digital currency transactions.

These collaborations, part of HKMA’s Project Ensemble, aim to integrate central bank digital currency (CBDC) infrastructures to streamline tokenized cross-border payments and modernise financial systems.

The partnership with BOT focuses on developing Payment versus Payment (PvP) and Delivery versus Payment (DvP) scenarios for trade payments and carbon credit management.

Both central banks plan to link HKMA’s Ensemble Sandbox with Thailand’s Project San in a proof-of-concept.

“This partnership will significantly advance tokenization efforts in our financial sectors, both domestically and cross-border.” emphasised Alisara Mahasandana, Deputy Governor of Corporate Development at BOT.

She added that the initiative would offer valuable insights into tokenization by considering diverse technical designs and regulatory requirements across jurisdictions.

Similarly, HKMA’s partnership with Banco Central do Brasil seeks to integrate the Ensemble Sandbox with Brazil’s Drex platform to explore PvP and DvP transactions for international transfers.

The Drex pilot, central to Brazil’s CBDC initiative, involves collaboration with over 70 financial companies.

HKMA noted that the pilot aims to support a tokenized financial market in Brazil, facilitating digital finance and collaboration across multiple sectors.

HKMA Chief Executive Eddie Yue described these partnerships as “concrete steps” in the field of tokenization, underlining the shared commitment between Hong Kong, Thailand, and Brazil to advance cross-border finance through digital asset infrastructure.