IDEAS home Printed from https://ideas.repec.org/b/bis/bisbps/115.html
   My bibliography  Save this book

Multi-CBDC arrangements and the future of cross-border payments

Author

Listed:
  • Raphael Auer
  • Philipp Haene
  • Henry Holden

Abstract

Cross-border payments are inefficient, and technology could play a role in making them better. One means could be through interoperating central bank digital currencies (CBDCs), forming multi-CBDC (mCBDC) arrangements. This paper explores dimensions of payment system interoperability, how they could feature in mCBDC arrangements and where potential benefits lie. These benefits are especially relevant for emerging market economies poorly served by the existing correspondent banking arrangements. Yet competing priorities and history show that these benefits will be difficult to achieve unless central banks incorporate cross-border considerations in their CBDC development from the start and coordinate internationally to avoid the mistakes of the past.

Suggested Citation

  • Raphael Auer & Philipp Haene & Henry Holden, 2021. "Multi-CBDC arrangements and the future of cross-border payments," BIS Papers, Bank for International Settlements, number 115, April.
  • Handle: RePEc:bis:bisbps:115
    as

    Download full text from publisher

    File URL: http://www.bis.org/publ/bppdf/bispap115.pdf
    File Function: Full PDF document
    Download Restriction: no

    File URL: http://www.bis.org/publ/bppdf/bispap115.htm
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Markus K. Brunnermeier & Harold James & Jean-Pierre Landau, 2019. "The Digitalization of Money," NBER Working Papers 26300, National Bureau of Economic Research, Inc.
    2. Douglas Arner & Raphael Auer & Jon Frost, 2020. "Stablecoins: risks, potential and regulation," Revista de Estabilidad Financiera, Banco de España, issue Autumn.
    3. Jon Frost & Hyun Song Shin & Peter Wierts, 2020. "An early stablecoin? The Bank of Amsterdam and the governance of money," DNB Working Papers 696, Netherlands Central Bank, Research Department.
    4. Gabriele Galati, 2002. "Settlement risk in foreign exchange markets and CLS Bank," BIS Quarterly Review, Bank for International Settlements, December.
    5. Antonio Diez de los Rios & Yu Zhu, 2020. "CBDC and Monetary Sovereignty," Staff Analytical Notes 2020-5, Bank of Canada.
    6. Tara Rice & Goetz von Peter & Codruta Boar, 2020. "On the global retreat of correspondent banks," BIS Quarterly Review, Bank for International Settlements, March.
    7. Codruta Boar & Henry Holden & Amber Wadsworth, 2020. "Impending arrival - a sequel to the survey on central bank digital currency," BIS Papers, Bank for International Settlements, number 107, April.
    8. Morten Linnemann Bech & Umar Faruqui & Takeshi Shirakami, 2020. "Payments without borders," BIS Quarterly Review, Bank for International Settlements, March.
    9. Raphael A. Auer & Giulio Cornelli & Jon Frost, 2020. "Rise of the Central Bank Digital Currencies: Drivers, Approaches and Technologies," CESifo Working Paper Series 8655, CESifo.
    10. Morten Linnemann Bech & Jenny Hancock, 2020. "Innovations in payments," BIS Quarterly Review, Bank for International Settlements, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Will Central Bank Digital Currencies Doom Dollar Dominance?
      by Barry Eichengreen in Project Syndicate on 2021-08-09 11:19:56

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Raphael Auer & Codruta Boar & Giulio Cornelli & Jon Frost & Henry Holden & Andreas Wehrli, 2021. "CBDCs beyond borders: results from a survey of central banks," BIS Papers, Bank for International Settlements, number 116, April.
    2. Raphael A. Auer & Giulio Cornelli & Jon Frost, 2020. "Rise of the Central Bank Digital Currencies: Drivers, Approaches and Technologies," CESifo Working Paper Series 8655, CESifo.
    3. Thitima Chucherd & Chanokkarn Mek-yong & Nalin Nookhwun & Passawuth Nuntnarumit & Natta Piyakarnchana & Suparit Suwanik, 2021. "Monetary and Financial Perspectives on Retail CBDC in the Thai Context," PIER Discussion Papers 152, Puey Ungphakorn Institute for Economic Research.
    4. Raphael Auer & Cyril Monnet & Hyun Song Shin, 2021. "Permissioned Distributed Ledgers and the Governance of Money," Diskussionsschriften dp2101, Universitaet Bern, Departement Volkswirtschaft.
    5. Agustín Carstens, 2020. "Shaping the future of payments," BIS Quarterly Review, Bank for International Settlements, March.
    6. Douglas Arner & Raphael Auer & Jon Frost, 2020. "Stablecoins: potential, risks and regulation," BIS Working Papers 905, Bank for International Settlements.
    7. Morten Linnemann Bech & Jenny Hancock, 2020. "Innovations in payments," BIS Quarterly Review, Bank for International Settlements, March.
    8. Raphael Auer & David Tercero-Lucas, 2021. "Distrust or speculation? the socioeconomic drivers of U.S. cryptocurrency investments," BIS Working Papers 951, Bank for International Settlements.
    9. Codruta Boar & Andreas Wehrli, 2021. "Ready, steady, go? - Results of the third BIS survey on central bank digital currency," BIS Papers, Bank for International Settlements, number 114, April.
    10. Erik Feyen & Jon Frost & Harish Natarajan & Tara Rice, 2021. "What Does Digital Money Mean for Emerging Market and Developing Economies?," Springer Books, in: Raghavendra Rau & Robert Wardrop & Luigi Zingales (ed.), The Palgrave Handbook of Technological Finance, pages 217-241, Springer.
    11. Raphael Auer & Rainer Boehme, 2020. "The technology of retail central bank digital currency," BIS Quarterly Review, Bank for International Settlements, March.
    12. Isaiah Hull & Or Sattath, 2021. "Revisiting the Properties of Money," Papers 2111.04483, arXiv.org, revised Nov 2021.
    13. Tara Rice & Goetz von Peter & Codruta Boar, 2020. "On the global retreat of correspondent banks," BIS Quarterly Review, Bank for International Settlements, March.
    14. Sergio Luis Náñez Alonso & Javier Jorge-Vazquez & Ricardo Francisco Reier Forradellas, 2021. "Central Banks Digital Currency: Detection of Optimal Countries for the Implementation of a CBDC and the Implication for Payment Industry Open Innovation," JOItmC, MDPI, vol. 7(1), pages 1-23, February.
    15. Raphael Auer & Rainer Boehme, 2021. "Central bank digital currency: the quest for minimally invasive technology," BIS Working Papers 948, Bank for International Settlements.
    16. Raphael A. Auer & David Tercero-Lucas, 2021. "Distrust or Speculation? The Socioeconomic Drivers of U.S. Cryptocurrency Investments," CESifo Working Paper Series 9287, CESifo.
    17. Morten Linnemann Bech & Umar Faruqui & Takeshi Shirakami, 2020. "Payments without borders," BIS Quarterly Review, Bank for International Settlements, March.
    18. Paulo Rupino Cunha & Paulo Melo & Helder Sebastião, 2021. "From Bitcoin to Central Bank Digital Currencies: Making Sense of the Digital Money Revolution," Future Internet, MDPI, vol. 13(7), pages 1-19, June.
    19. Fischer, Andreas M. & Ranaldo, Angelo, 2011. "Does FOMC news increase global FX trading?," Journal of Banking & Finance, Elsevier, vol. 35(11), pages 2965-2973, November.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bis:bisbps:115. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://edirc.repec.org/data/bisssch.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Christian Beslmeisl (email available below). General contact details of provider: https://edirc.repec.org/data/bisssch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.