Journal of Financial Market Infrastructures

This issue of The Journal of Financial Market Infrastructures offers three research papers, which investigate the use of stablecoins and digital currency for settlement and the increasing use of artificial intelligence agents for cash management in payment systems. The journal strives to provide its readership with a selection of cutting-edge papers, particularly those on “out of the box” ideas and analytics that underpin research in stablecoins and tokenized deposits; nonbank payment service providers and access to central bank payment rails; distributed ledger technologies, machine learning and artificial intelligence and their impact on financial market infrastructures; payments, netting and settlement time (T₀), and clearing systems; and digital money (both private and public) and its impact on central bank operations and central bank balance sheets, including seigniorage.

In the first paper in the issue, Lars Hupel takes “A money view of offline payment functionality” and suggests what a practical offline-capable instant payment system should look like. Proposals to equip instant payment systems with offline functionality would involve commercial banks and private money, making the impact on balance sheets less clear than for cash and central bank digital currency transactions. Hupel models the issuance of an offline token by the central bank (ie, a central bank digital currency); of offline tokens by multiple issuers, where financial institutions would cooperate but retain tokens in their own balance sheets; and of an offline token by a non-central-bank single issuer, such as a national clearing house or instant payment system operator. To analyze the financial accounts of offline tokens, the author uses two different notations: the classic balance sheet and “Dutch notation”. Ultimately, Hupel argues in favor of a single-issuer model to retain fungibility, reduce counterparty risk and simplify settlement.

The issue’s second paper, “AI agents for cash management in payment systems” by Iñaki Aldasoro and Ajit Desai, evaluates, using prompt-based experiments with ChatGPT’s reasoning model, whether generative artificial intelligence models can assist with high-level intraday liquidity-management tasks in wholesale payment systems. The authors show that, in a stylized real-time gross settlement setup, even without domain-specific training, the artificial intelligence agent produces recommendations that are broadly consistent with key cash-management practices to preserve liquidity while minimizing delays. Their findings suggest that general-purpose artificial intelligence models may assist routine cash-management decisions and help lay the groundwork for specialized systems that could automate bounded tasks, potentially reducing operational costs and improving intraday liquidity efficiency. The authors underscore the need for testing, benchmarking and governance before operational use, and they outline the key risks and suggest relevant policy and regulatory safeguards.

Finally, in our third paper, “Eclipsing the pyramid: stablecoins and settlement”, Cl´ement Berthou and Xavier Lavayssi`ere formalize the concept of ‘settlement eclipse”, which occurs when a financial institution or a payment and settlement system internalizes transfers at sufficient scale that the settlement function of a layer of the monetary pyramid is occulted by the layer beneath it. The authors also examine policy options and the potential emergence of a tokenized monetary pyramid: stablecoins are more operationally autonomous from the traditional monetary pyramid and more structurally concentrated. The authors conclude that stablecoins challenge the existing monetary architecture by eclipsing settlement while remaining dependent on traditional financial institutions for reserve management and redemption. Whether a tokenized monetary pyramid acquires a direct public anchor or remains structurally subordinate to the traditional one is an institutional and political choice rather than a technological one, with direct consequences for financial stability, monetary policy transmission and the distribution of systemic risk.

The editorial board encourages regular submissions, and for selected papers we find opportunities for seminars to disseminate key messages. Recent papers were presented at a joint seminar by the Bank for International Settlements Innovation Hub Hong Kong Centre and The Journal of Financial Market Infrastructures, and at the International Monetary Fund. Past and forthcoming special issues of our journal include papers presented at the 23rd Simulator Seminar, hosted by the Bank of Finland, and at the Central Bank of Peru’s annual conference, which focused heavily on digital transformation and macroeconomic resilience. A special issue in collaboration with an Asian central bank is planned for 2027.

We welcome suggestions for topics that would be of particular interest to our readers as the landscape of money, collateral and financial market infrastructures continues to change rapidly in the digital era.