The Bank for International Settlements' (BIS) involvement in mBridge is under scrutiny following a report that top officials discussed potentially shutting down the project. This development comes after Russian President Vladimir Putin expressed interest in creating an alternative international payments system, which has put the spotlight on mBridge. The project, backed by the BIS Innovation Hub and run by the central banks of China, Thailand, the UAE, and Hong Kong, aims to facilitate quicker and cheaper international money transfers by eliminating the need for intermediary banks.
As of October 2024, mBridge had 32 observing members and 39 participating commercial banks, with transactions conducted in four central bank digital currencies (CBDCs). Proponents of the project argue that it can help underserved regions by allowing countries to settle payments in their own currency and utilizing distributed ledger technology for faster transactions. However, critics are concerned about the potential geopolitical risks, including the use of China-developed technology and the potential reduction in the ability to enforce economic sanctions.
The BIS has described mBridge as a 'public good' that can foster financial inclusion, but the project's future remains uncertain.