LONDON - Forty of the world's leading commercial banks have joined a G7-dominated pilot scheme with the New York Fed and leading central banks from Europe, South Korea and Japan for a new digital currency platform designed to speed up and enhance cross-border payments.

The Agora project involves seven central banks in total and will aim to see if so-called 'tokenized' bank deposits can be used in combination with tokenized central bank digital currencies (CBDCs) in a faster and more advanced system.

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It will focus on what are known as "wholesale" CBDCs - which are used only between banks rather than by the public - and look to iron out the challenges of different time zones, legal requirements and regulatory and technical systems.

The list of commercial banks taking part includes many of the world's biggest lenders such as JPMorgan, HSBC, UBS, and Japan's MUFG.

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Led by the Bank for International Settlements and banking group the Institute of International Finance, it also cements something of a divide in the development of CBDCs, between Agora project and another called mBridge launched in 2021 between the central banks of China, Hong Kong Special Administrative Region, Thailand and the United Arab Emirates and recently joined by Saudi Arabia.