Bob and Amy delve into the intricacies of synchronized settlement in the foreign exchange (FX) market, spotlighting Project Meridian FX—a collaborative initiative led by the Bank for International Settlements in partnership with multiple central banks. The project advances previous research on the technical viability of atomic settlement for FX transactions across diverse payment systems, including both distributed ledger technology (DLT) platforms and conventional Real-Time Gross Settlement (RTGS) systems.
At the heart of this initiative is the Synchronisation Operator (SO)—a prototype designed to coordinate the simultaneous exchange of funds and assets across different systems. The successful development and testing of this prototype demonstrated a high degree of interoperability and adaptability, underlining its potential to mitigate FX settlement risk and enhance liquidity efficiency in cross-border transactions.
The outcomes of Project Meridian FX offer valuable insights for the evolution of wholesale payment infrastructures and support the broader pursuit of interoperable, risk-reducing solutions in global financial markets.
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