The Bank for International Settlements Innovation Hub published an update on Project Titus, which explores whether auction mechanisms and automated side-payments can improve liquidity efficiency in real-time gross settlement (RTGS) systems while preserving timely settlement. The project proposes an auction-based liquidity-saving mechanism (LSM) that lets participants bid to pay for liquidity or receive compensation in exchange for it. When aggregated bids pass a positive threshold, the auction clears and side-payments redistribute liquidity costs across participants; the process can run in short, periodic settlement cycles. Testing on RTGS transaction data across different system configurations and operational policies produced high clearing rates and significant liquidity savings compared with standard RTGS settlement, with outcomes sensitive to system design and queue management strategies. The Hub frames Titus as a proof of concept and positions the underlying framework as relevant for emerging tokenised and instant payment systems where liquidity pressures may become more acute, alongside a related working paper on auction-based LSMs.

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