Bank for International Settlements Innovation Hub publishes Project Pine prototype for tokenised central bank open market operations

The Bank for International Settlements Innovation Hub has released the final report on Project Pine, a joint study by the BIS Innovation Hub Swiss Centre and the Federal Reserve Bank of New York’s New York Innovation Center, examining whether and how central banks could conduct monetary policy operations in tokenised wholesale markets using smart contracts. The work produced a prototype intended to demonstrate how monetary policy implementation could function in market infrastructures built around digital tokens. Project Pine developed a generic monetary policy implementation toolkit designed to be technically modifiable for different central banks’ frameworks and calibrated to support both standard and emergency market operations across jurisdictions and currencies. The Innovation Hub notes that its projects are experimental and intended to deliver public goods for the global central banking community, and that the New York Innovation Center’s participation was limited to research and experimentation purposes. The prototype is positioned as a basis for potential further research and development by central banks.