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Nexus is a model for connecting multiple national payment systems into a cross-border platform that could enable international payments to happen as quickly as sending a text message. The summary report addresses the challenges that would need to be overcome and explains how a bridging platform like Nexus could streamline the process of linking national systems. It makes recommendations for countries that are upgrading or rebuilding their payments technology to prepare for cross-border interoperability.

The Monetary Authority of Singapore (MAS) announced the 15 finalists for the global competition to develop retail central bank digital currency (CBDC) solutions (Global CBDC Challenge). The finalists will progress to the Acceleration Phase before they pitch their solutions to a panel of judges and an international audience at this year's Singapore FinTech Festival. The Challenge attracted over 300 submissions from more than 50 countries. Participants were invited to address 12 problem statements relating to (i) CBDC instrument; (ii) CBDC distribution; and (iii) CBDC infrastructure; covering topics such as inclusivity, interoperability and programmability. The proposals from the finalists sought to address multiple problem statements through a variety of technology approaches including hardware wallets, digital identity and asset tokenisation solutions.

The Central Bank of Nigeria (CBN) will reportedly launch a pilot of its e-nairu that will be run on the "two-tier" model whereby the central bank designs and distributes the digital currency (CBDC) and regulated financial institutions provide it to individuals and businesses. The CBN hopes that this strategy will help it "address interoperability risks that might be associated with the implementation." The CBN reckons the risk of financial disintermediation can be addressed via the imposition of limits on e-naira holdings.

According to this paper by Diem/Novi's Christian Catalini and Andrew Lilley there are at least three ways to remove frictions in payments and rapidly expand the number of individuals and businesses that can access the financial system and cheaply transact in real time. The first is to bring deposits on a single ledger through a central bank digital currency (CBDC), so that transfers between banks are not limited by external liquidity constraints or third-party rails. The second approach is to follow countries such as India and Mexico and increase the throughput of always-on real-time gross settlement (RTGS) systems, the model the US Federal Reserve is pursuing with the introduction of FedNow, targeted for 2023. The third approach is to facilitate the growth of interoperable, stablecoin payment rails by creating the right regulatory framework for these new types of networks to safely increase competition in payments.

El Salvador's government is rolling out 200 ATMs and preparing 50 bank branches across the nation to allow residents to exchange crypto for fiat easily, in preparation for adopting Bitcoin (BTC) as legal tender. Those not interested in using BTC will be able to exchange the BTC for cash at any of those locations. The U.S. dollar will continue to be in circulation. El Salvador has also created the Chivo crypto wallet that would be compatible with the new ATMs and would be interoperable with any existing crypto wallet.

The Bangko Sentral ng Pilipinas the Monetary Authority of Singapore signed an enhanced FinTech Cooperation Agreement facilitate interoperable payments between the Philippines and Singapore. It will facilitate the linkage of both countries' real-time and QR payment systems, to facilitate instant, seamless, and low-cost cross-border payments. This is a significant initiative given the sizeable remittance flows between the Philippines and Singapore, which totaled 2.15 billion in 2020.

Visa published a paper on its "universal payments channel" (UPC) that will facilitate transactions between various stablecoins and central bank digital currencies (CBDCs). Specifically, it proposes a hub-and-spoke payment route that can be used to support digital token transfers of funds across different networks through payment channels. The UPC protocol facilitates payments through a "UPC hub" that acts as a gateway to receive payment requests from registered sending parties and routes them to registered recipient parties.

The new Governor of the Bank of Mexico, Victoria Rodríguez Ceja, confirmed plans to release a retail central bank digital currency (CBDC) during 2025. During a presentation to the Mexican Senate, the Governor said the first goal of its CBDC will be financial inclusion. It also wants to provide more fast payments options and ensure the economy is efficient and interoperable. The Governor said she's also keen to enable programmable money and promote innovation. https://www.banxico.org.mx/publications-and-press/speeches/%7BD7EB1919-DE55-95ED-B0F7-0887AE4C6843%7D.pdf

The Hong Kong Monetary Authority (HKMA) has published a discussion paper inviting views on the key issues around a retail central bank digital currency (CBDC). This is a followup to the paper published in October 2021 on potential architectures and design options for distributing e-HKD, and this new one focuses on use cases, the issuance mechanism, interoperability with other payment systems, privacy and data protection. Members of the public and the industry have until May 27, 2022 to submit comments.

The Bank of Jamaica (BOJ), working with eCurrency Mint Inc., successfully completed its central bank digital currency (CBDC) proof of concept (PoC) and pilot work, and will begin a public rollout in Q1 2022. After a prototype was tested in the BOJ's Fintech Regulatory Sandbox, in May 2021 the National Commercial Bank (NCB) was brought onboard for further testing. On August 9-10 the BOJ minted $230 million of CBDC of which $1 million was distributed to BOJ staff for further internal testing. On October 29, the BOJ distributed $5 million of CBDC to the NCB for an NCB-sponsored "Market on the Lawn" pilot event, for which 4 small merchants and 53 consumers were onboarded to conduct transactions between each other. The NCB will continue onboarding customers, plus two additional wallet providers will soon be able to order CBDC from the BOJ and distribute to their customers. Interoperability will be tested between customers of various participating wallet providers.

The Asian Development Bank (ADB) has launched a project to develop ways to directly connect central banks and securities depositories in the ASEAN+3 region within a blockchain network. The region consists of the Association of Southeast Asian Nations plus Japan, the People's Republic of China, and the Republic of Korea. ADB is partnering with ConsenSys, Fujitsu, R3, and Soramitsu on the project, which will also examine systems interoperability and the viability of central bank digital currency (CBDC) in the region.

The USDF Consortium, an association of FDIC-insured financial institutions, launched, with a mission to build a network of banks to further the adoption and interoperability of a bank-minted USDF stablecoin. USDF will be minted exclusively by U.S. banks and will be redeemable on a 1:1 basis for cash from a Consortium member bank. The Consortium's founding bank members include New York Community Bank, NBH Bank, FirstBank, Sterling National Bank, and Synovus Bank.

Circle, the issuer of USD stablecoin, is pushing forward with its plans to submit an application to operate as a U.S. crypto bank, CEO Jeremy Allaire told Bloomberg. If approved, the startup would be the fourth federally chartered crypto bank in the U.S. Allaire added that his company and the U.S. Office of the Comptroller of the Currency, which facilitates bank charters, have been talking about Circle's digital asset banking prospects among other related topics such as the interoperability between blockchains.

"We propose a two-phased approach. In the first phase, the BoC introduces a centralized platform as a public-good infrastructure that establishes digital cash and ensures global/domestic interoperability. In this phase, e-KYC-based authentication leverages existing private/public sector solutions but also safeguards users' privacy/data against third-party commercial interests while complying with AML/CFT. In the second phase, the BoC will expand the platform to an enterprise-level permissioned blockchain. This shared resource will transform CBDLs into "programmable e-money" within a "social operating system" that will enable Canadians to operate, innovate, compete, and thrive in this new global digital economy."

The 2022 TechSprint will be launched by the BIS Innovation Hub and Bank Indonesia on April 25. It will focus on solving technology challenges related to wholesale and retail central bank digital currencies (CBDCs). Shortlisted teams will be invited to showcase their prototypes in July and winners will be chosen in October by an independent panel. Key challenges identified include building effective and robust means to issue, distribute and transfer CBDCs, enabling financial inclusion, and improving interoperability.

The crypto press has discovered that Ripple is part of a task force convened by the Bank for International Settlements (BIS) Committee on Payments and Market Infrastructure (CPMI) cross-border payments interoperability and extension (PIE) task force. That does seem to be a big deal, because Ripple has been persona non grata in any international forums in which the US government plays a key role, on account of the firm's ongoing legal dispute between the US Securities and Exchange Commission (SEC). It's why you haven't seen much, if any engagement between Ripple and any G20 central banks since the legal dispute started in 2020. https://www.bis.org/cpmi/cross_border/events.htm

UK Finance and Oliver Wyman published a report that looks at how securities tokenization will transform capital markets. It recommends that the government and industry foster a flourishing UK digital market by promoting interoperability and safe innovation at scale, to enable innovation and experimentation, underpinned by legal and regulatory certainty.

The Banque de France (BdF) published an updated set of conclusions and lessons learned from its twelve distributed ledger technology (DLT) based wholesale central bank digital currency (CBDC) experiments. They show the operational feasibility and practical implementation of the three models it has conceptualized for issuing DLT-based wholesale CBDC; the interoperability, distribution and integration models. They all address key aspects of wholesale CBDC implementation and each model offers different capabilities and functionalities compared to the conventional systems, so they can be complementary rather than exclusive.

The Federal Reserve Bank of New York's New York Innovation Center (NYIC), in collaboration with members of the U.S. financial services sector, published the findings of a proof of concept (PoC) that explored the feasibility of an interoperable network for wholesale payments operating on a shared multi-entity distributed ledger. The research project, undertaken jointly with private sector organizations, experimented with the concept of a regulated liability network (RLN), a theoretical payment infrastructure designed to support the exchange and settlement of regulated digital assets. The experiment successfully simulated both the domestic and cross-border scenarios, identifying shared ledger technology as a potential solution to support payment innovation.

JP Morgan is participating in the Regulated Liability Network (RLN). Earlier in September 2023, the UK arm of the RLN shared the findings of its latest work without mentioning the participants. The network aims to bring together banks and central banks to support different types of digital currency on the same network. That includes central bank digital currency (CBDC), deposit tokens and regulated stablecoins. In July the US RLN published a report involving several other U.S. banks, the New York Federal Reserve's innovation arm and Mastercard. The premise that underpins the RLN is interoperability so that banks don't need to use the same type of blockchain to transfer tokens between them.