The Bank for International Settlements (BIS) has announced its withdrawal from Project mBridge, a cross-border digital payments initiative involving China, Hong Kong, Thailand, the UAE, and more recently, Saudi Arabia. During a banking conference in Madrid, BIS General Manager Agustin Carstens explained that the decision was based on the project’s maturity, allowing partner countries to continue without BIS involvement.
While mBridge is not intended to serve the needs of BRICS nations, Carstens emphasized the importance of adhering to international sanctions. The BIS aims to avoid any association with projects that could be seen as circumventing these restrictions. Analysts like Josh Lipsky from the Atlantic Council note that this decision reflects the growing geopolitical significance of payment systems, especially in light of concerns regarding Russia’s ambitions in the digital currency space.
As the BRICS summit has highlighted, the West is increasingly wary of China’s role in developing alternative financial systems. With the BIS stepping back, it raises questions about the future trajectory of Project mBridge and the level of transparency surrounding it, especially as China is likely to push forward independently. This move signals a complex dynamic in global finance, where digital currencies are becoming pivotal in the geopolitical arena.
