Project Pine: central bank open market operations using tokenisation and smart contracts
14 May 2025
Tokenisation has the potential to transform the financial market infrastructures underlying payments and securities. If the financial sector adopts tokenisation on a broad scale in wholesale markets, central banks may need to participate in novel infrastructures and interact with digital tokens to continue effectively implementing monetary policy.
Despite research on how wholesale markets and conventions might change, there has been relatively little experimentation with implementing monetary policy using tokenisation.
Project Pine, a joint research study by the New York Fed's New York Innovation Center and the BIS Innovation Hub Swiss Centre, explored if and how central banks can continue implementing monetary policy operations in a tokenised world.
The project successfully created a prototype of a generic monetary policy implementation toolkit for potential further research and development by central banks across jurisdictions and currencies. The prototype was designed to be technically modifiable for different central banks' monetary policy frameworks and calibrated to conduct standard or emergency market operations.
- Read the final report here: Project Pine: central bank open market operations with smart contracts
BIS Innovation Hub projects are experimental and aim to explore and deliver public goods to the global central banking community. The New York Innovation Centre at the Federal Reserve Bank of New York's participation in Project Pine was limited to research and experimentation purposes.