BSP Sees Wholesale CBDC for Securities Settlement, Cross-Border Payments
The Bangko Sentral ng Pilipinas (BSP) has identified the settlement of financial securities and large-value cross-border payments as potential applications for wholesale central bank digital currency (wCBDC). This was highlighted in the central bank’s “Project Agila” report, which aims to assist the BSP and participating financial institutions in exploring potential central bank digital currency use cases.
CBDCs are digital forms of money that constitute direct liabilities of the central bank. A wCBDC is a specific type of digital currency designed for use by commercial banks and other financial institutions.
System Mechanics and DLT Integration
Using DLT Enables Lower Transaction Costs
Much like the current Real-Time Gross Settlement (RTGS) system, a wCBDC would allow each bank to maintain an account with the BSP. Balances would then be credited or debited based on transactions with other banks. The central bank noted that the key difference from existing infrastructure is the use of distributed ledger technology (DLT), which enables greater automation, faster processing, and lower transaction costs.
According to BSP Governor Eli M. Remolona, Jr., “Wholesale CBDCs can enhance efficiency in the payments infrastructure and develop new financial services that could address evolving needs in the national payments ecosystem.” The BSP also stated in the report that adopting wCBDCs for financial securities transactions could significantly reduce settlement risks by narrowing the time gap between trade execution and final settlement.
Pilot Scope and Technical Performance
Two Phases of BSP CBDC Project Agila
Project Agila was conducted in two phases, utilizing Oracle’s Hyperledger Fabric platform, which was selected over Corda during the system selection phase. (Read More: BSP Selects Hyperledger Fabric as Blockchain for Pilot CBDC Project)
Six local financial institutions participated in the proof-of-concept tests:
- BDO Unibank,
- China Banking Corporation,
- Land Bank of the Philippines,
- Rizal Commercial Banking Corporation,
- Union Bank of the Philippines, and
- Maya Philippines.
(Read More: List of 10 Major Philippine Banks in BSP CBDC Project)
Scalability Test Results
Scalability tests revealed that the tested cloud platform successfully processed 105,000 transactions within a specific timeline, averaging an elapsed time of 1,490.51 milliseconds per transaction. The system recorded an error rate of 0.03% during this test window, which the BSP noted compares favorably to the existing PhilPaSSplus system that processed an average of 6,789 transactions daily in the first quarter of 2025. However, performance testing revealed throughput limitations when handling larger volumes exceeding 200,000 daily transactions, indicating a need for future cloud configuration adjustments.
Security Vulnerabilities and Technical Gaps
The evaluation also identified specific technical defects and security vulnerabilities within the sandbox environment. The BSP Project Management Team identified a high-severity issue where the system failed to sanitize input code properly, leaving it exposed to potential SQL injection and Cross-Site Scripting (XSS) actions.
Participating financial institutions reported additional operational issues during end-to-end processing. China Banking Corporation noted a high-severity flaw that allowed users to view the wCBDC account balances of other banks, while BDO Unibank reported that the architecture allowed administrators to view individual user banking transactions. According to the report, learnings from these Project Agila tests will guide the formulation of the BSP’s official CBDC Roadmap to lay out the central bank’s strategic direction.
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