A Multi-Currency Exchange and Contracting Platform
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
Summary:
Cross-border payments can be slow, expensive, and risky. They are intermediated by counterparties in different jurisdictions which rely on costly trusted relationships to offset the lack of a common settlement asset as well as common rules and governance. In this paper, we present a vision for a multilateral platform that could improve cross-border payments, as well as related foreign exchange transactions, risk sharing, and more generally, financial contracting. The approach is to leverage technological innovations for public policy objectives. A common ledger, smart contracts, and encryption offer significant gains to market efficiency, completeness, and access, as well as to transparency, transaction and compliance costs, and safety. This paper is a first step aiming to stimulate further work in this space.
Series:
Working Paper No. 2022/217
Subject:
Currencies Currency markets Financial markets Financial statements Foreign exchange Money Public financial management (PFM) Smart contracts Technology
Frequency:
regular
English
Publication Date:
November 4, 2022
ISBN/ISSN:
9798400224188/1018-5941
Stock No:
WPIEA2022217
Pages:
57
Please address any questions about this title to publications@imf.org