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12 December 2019

BIS: CPMI report sets out considerations for developers of wholesale digital tokens


A new report by the Committee on Payments and Market Infrastructures (CPMI) sets out a list of criteria for developers and market participants to consider when designing digital tokens for use in wholesale transactions.

The Wholesale digital tokens report describes the potential innovations and design questions associated with digital tokens that could be used to settle wholesale, or large-value, payments, made possible by new technologies such as blockchain, or distributed ledger technology.

Private developers are exploring several applications for wholesale digital tokens. While these could be developed simply to make payments, many initiatives also seek to provide the payment leg of tokenised securities and FX transactions, where a token represents a share, bond or other financial asset.

The report only covers variants of digital tokens issued by identifiable issuers and denominated in sovereign currency. It is not directed at so-called "stablecoins" for retail payments.

The report describes the critical elements of wholesale digital token arrangements and discusses some potential design choices. It also includes a non-exhaustive list of questions that token developers may need to consider. Important considerations include availability, issuance and redemption, access, underlying assets/funds and claims, transfer mechanism, privacy and regulatory compliance, and interoperability.

Full press release on BIS

Full report on BIS



© BIS - Bank for International Settlements


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