The Bank for International Settlements (BIS) completed a project called Agorá that tested how banks can use digital tokens to send money across countries. The test showed that payments using tokenized assets—digital versions of real money or assets—can settle in just seconds instead of hours or days. This is important because big banks and financial institutions currently wait a long time to confirm that cross-border payments are complete.
Banks have to wait because they use old systems that don't talk to each other well. When a bank in one country sends money to a bank in another country, the payment has to go through multiple middle people and check points. Each step takes time. Tokenization means turning real money or assets into digital tokens that live on a shared network where all banks can see them at once, like a public scoreboard everyone trusts.
This matters most for big banks that move enormous amounts of money daily. When payments settle faster, banks can use their money more efficiently and offer better service to their customers. A bank that receives payment instantly can invest that money or lend it out right away instead of waiting. Smaller banks and companies that rely on fast international payments also benefit because costs could drop.
The BIS is now working with central banks and commercial banks around the world to decide whether to expand this system. The group will need to agree on common rules and standards so all banks can use the same tokenized payment network. This coordination typically takes months or years because hundreds of financial institutions need to be involved and everyone must approve the changes.