DeFi Cross-Border Payments: BIS Innovation with Project Rialto

This episode discusses Project Rialto, an initiative exploring how decentralised finance (DeFi) can improve cross-border payments. The Bank for International Settlements (BIS) report highlights that retail cross-border payments, currently a multi-billion dollar market, suffer from inefficiencies. Project Rialto aims to demonstrate the feasibility of using interlinked instant payment systems with an automated foreign exchange (FX) conversion layer. This would leverage central bank money (CeBM) to streamline settlement, reduce risks like liquidity and credit exposure, and lower costs. The project is a collaboration between multiple central banks and the BIS Innovation Hub, testing tokenised assets and DeFi technologies at an institutional scale. Ultimately, the goal is to create faster, cheaper and more transparent international payments by integrating existing infrastructure with innovative decentralised solutions.