LionRock-Inthanon.pdf

Aims to improve cross-border settlement efficiency, liquidity management efficiency, and comply with local regulations using Distributed Ledger Technology (DLT).

Key Features:
- Improves cross-border settlement efficiency
- Enhances liquidity management efficiency
- Complies with local regulations
- Allows for a wider scope with extensible architecture

Project Components:
- Project LionRock: Led by the Hong Kong Monetary Authority (HKMA), explores the feasibility of DLT for CBDC issuance, bond tokenization, and Delivery versus Payment (DvP).
- Project Inthanon: Led by the Bank of Thailand (BOT), aims to enhance Thailand's financial infrastructure and encourage collaborative learning among involved parties.

Objectives:
- Achieve real-time cross-border transfers and FX payments via a corridor network
- Enable atomic Payment-versus-Payment (PvP) settlements
- Implement a liquidity mechanism for on-demand FX liquidity management
- Ensure regulatory compliance for HKD/THB wallets and transactions

Phases:
- Phase 1 (2018): Building the fundamentals, including DLT evaluation for CBDC issuance and bond tokenization.
- Phase 2 (2019): Enhancing functionalities, including tokenization of cash and bonds, gridlock resolution, and automated liquidity provision.

Partnerships:
- Collaborations with note-issuing banks, the Hong Kong Interbank Clearing Ltd., and the R3 consortium for Project LionRock.
- Partnerships with R3 and eight participating banks for Project Inthanon.

Outcomes:
- A proof-of-concept for domestic wholesale funds transfer using Central Bank Digital Currency (CBDC).
- Exploration of cross-border funds transfer models for instant interbank and international transfers.
- Development of a corridor network for real-time cross-border transfers and FX payments with reduced settlement layers.