--- title: "Stablecoins vs CBDCs vs linked instant payment systems: five ways to fix cross-border payments" seoTitle: "Stablecoins vs CBDCs vs Nexus for cross-border payments" description: "Stablecoins, mBridge, Project Nexus, tokenized deposits, and Fnality all target slow cross-border payments. How each works and who can use it today." date: "2026-10-25" updated: "2026-10-25" category: "payments" author: "BlindPay Team" faq: - q: "What is the difference between a stablecoin and a CBDC?" a: "A stablecoin is issued by a private company and backed by reserves such as deposits and short-term Treasuries. A central bank digital currency (CBDC) is a direct claim on a central bank. Projects like mBridge use wholesale CBDCs, meaning only banks hold them, on a shared ledger. Stablecoins circulate on public blockchains that businesses can reach through a provider." - q: "What is Project Nexus?" a: "Project Nexus is a design for linking national instant payment systems through one multilateral gateway, started by the BIS Innovation Hub. Instead of building a separate link for each pair of countries, each system connects once to Nexus. In April 2025 the central banks of India, Malaysia, the Philippines, Singapore, and Thailand incorporated Nexus Global Payments in Singapore to run it." - q: "Is Project Nexus live?" a: "As of its operators' latest public statements reviewed in October 2026, Nexus was in its operational build-out. The Bank of Thailand's April 2025 release said Nexus Global Payments had started procurement for a technical operator and that the BIS would support the project until the first live Nexus transaction. Check the operators' releases for current status." - q: "What happened to Project mBridge?" a: "mBridge is a wholesale CBDC platform developed with the central banks of China, Hong Kong, Thailand, and the UAE. On October 31, 2024, BIS General Manager Agustín Carstens said the BIS was leaving the project, describing it as a graduation and saying the partners could continue independently. The project is wholesale: participating banks, not businesses, hold and settle in the CBDCs." - q: "Can a business use a CBDC or Nexus for Latin America payouts today?" a: "Not as a general cross-border option. mBridge is wholesale, for participating banks, and Nexus's first movers are in Asia. For payments into Brazil, Mexico, Colombia, or Argentina, businesses use a correspondent banking wire, a money transfer operator, or a stablecoin converted into local currency and paid out over Pix, SPEI, ACH Colombia, or Transfers 3.0." - q: "What are tokenized deposits?" a: "Tokenized deposits are blockchain representations of ordinary commercial bank deposits, issued by the bank itself. The BIS cites JPMorgan's Kinexys platform, where tokenized deposits move 24/7 among JPMorgan's institutional clients on a permissioned blockchain and can support conditional payments. Unlike stablecoins, they stay inside one bank's client network rather than circulating on public blockchains." --- Five approaches compete to fix slow, costly cross-border payments: private stablecoins, wholesale CBDCs like mBridge, linked instant payment systems like Project Nexus, tokenized bank deposits like Kinexys, and tokenized central bank reserves like Fnality. Only stablecoins circulate on open networks a business can use today across most corridors. The others are bank-only or regional. They all attack the same problem from the [stablecoin sandwich](/resources/more/what-is-a-stablecoin-sandwich) side or the bank side. Section 7.7 of the [BIS Working Paper 1385](https://www.bis.org/publications/working-paper-1385-competing-rails-crossborder-payments-banks-fintechs-and-stablecoins) (October 2026) reviews the four non-stablecoin projects. This page puts all five next to each other. **Key takeaways** - Every approach targets the same friction: long correspondent banking chains, which the Fed links to slower, costlier, less trackable payments. - Nexus links domestic instant payment systems without creating a new settlement asset. Its first movers are in Asia. - mBridge uses wholesale CBDCs on a shared ledger for banks; the BIS left the project in October 2024. - Tokenized deposits (Kinexys) and tokenized reserves (Fnality) are institutional, permissioned tools. - Stablecoins are the open option, but they still need regulated on-ramps and off-ramps at each end. ## What problem are all five trying to solve? The correspondent banking chain. The Federal Reserve's [March 30, 2026 FEDS Note](https://www.federalreserve.gov/econres/notes/feds-notes/payment-stablecoins-and-cross-border-payments-benefits-and-implications-for-monetary-policy-20260330.html) lays out the numbers. More than 50% of international payments on SWIFT are in US dollars. Over 60% of wholesale payments are routed through one or more intermediaries. The number of active correspondent banks fell about 30% over the decade to 2022. Each hop adds time, makes the payment harder to track, and can repeat AML checks. Small banks can't afford their own foreign branches, so they route through big ones. The five approaches below each cut the chain in a different place. [Why cross-border payments are slow](/resources/more/why-are-cross-border-payments-slow) covers where the days go. ## How do the five approaches compare? By settlement asset and by who gets to use it. This table uses the BIS paper's descriptions plus the operators' own releases. | Approach | Example | Settlement asset | Who can use it | Status (public sources, Oct 2026) | | --- | --- | --- | --- | --- | | Stablecoins | USDC, USDT | Private token backed by reserves | Anyone through a regulated provider, on public blockchains | In use; GENIUS Act framework passed July 2025 | | Linked instant payment systems | Project Nexus | None new; domestic fast payment money | People and businesses in connected countries | Nexus Global Payments incorporated April 2025; building toward first live transaction | | Wholesale CBDC | Project mBridge | Central bank digital currency | Participating banks | Continued by member central banks after the BIS left in October 2024 | | Tokenized deposits | Kinexys by J.P. Morgan | Commercial bank deposit on a permissioned chain | That bank's institutional clients | Operating, per the BIS paper | | Tokenized central bank reserves | Fnality | Tokens backed by reserves held at central banks | Wholesale financial institutions | Designed for wholesale settlement, per the BIS paper | ## What is a linked instant payment system, and how does Nexus work? It connects domestic fast payment systems so a payment can start on one and finish on another. No new money is created. The BIS paper describes Nexus as "a single multilateral gateway, allowing instant cross-border retail payments without creating a new settlement asset." The trick is the hub. Today, Singapore runs bilateral links: PayNow to Thailand's PromptPay (2021), to Malaysia's DuitNow (2023), and to India's UPI (2023), per the BIS paper. Each one was its own project. With Nexus, each system connects once and reaches every other member. The timeline from public releases: 1. **July 1, 2024.** The BIS [announced](https://www.bis.org/press/p240701.htm) Nexus had completed its blueprint. India joined Malaysia, the Philippines, Singapore, and Thailand for the next phase. The BIS said it would take an advisory role, not own or operate the scheme. Agustín Carstens said Nexus could reach 1.7 billion people with the first wave of countries. 2. **April 3, 2025.** The Bank of Thailand [announced](https://www.bot.or.th/en/news-and-media/news/news-20250403.html) that the central banks of India, Malaysia, the Philippines, Singapore, and Thailand had incorporated Nexus Global Payments in Singapore as a not-for-profit company. The ECB and Bank Indonesia stayed on as special observers. Procurement for a technical operator began. The limit for a business in the Americas: the members are Asian. A US company paying a supplier in São Paulo gets nothing from Nexus. [Instant payment systems by country](/resources/more/instant-payment-systems-by-country) lists which domestic systems exist. ## What is a wholesale CBDC, and what happened to mBridge? A wholesale CBDC is central bank money in digital form, held only by banks. mBridge put several of them on one shared ledger so banks in different countries could settle in each other's CBDCs with payment-versus-payment, meaning both currency legs settle at once or not at all. The BIS paper lists the founding participants: the People's Bank of China, the Hong Kong Monetary Authority, the Bank of Thailand, and the Central Bank of the UAE. On October 31, 2024, BIS General Manager Agustín Carstens said the BIS was leaving the project. He framed it as a "graduation" and said "the project has matured to a point where our partners can continue independently," as [reported by The Global Treasurer](https://www.theglobaltreasurer.com/2024/11/01/bank-for-international-settlements-leaves-chinese-cbdc-project/). For a business, the key word is wholesale. You don't hold mBridge money. Your bank might, if it participates. Atomic settlement of both FX legs is also the fix for [Herstatt risk](/resources/more/herstatt-risk-fx-settlement-risk), which is why wholesale projects focus on it. ## What are tokenized deposits and tokenized reserves? Both are bank-world tokens on permissioned ledgers. **Tokenized deposits** are a bank's own deposits in token form. The BIS paper cites JPMorgan's Kinexys: deposits on a permissioned blockchain that move 24/7 among JPMorgan's institutional clients and support conditional payments and delivery-versus-payment. The reach is the bank's client network. **Tokenized central bank reserves** go one level up. The BIS describes Fnality as issuing tokens backed by central bank reserves in omnibus accounts at participating central banks, designed for 24/7 settlement of tokenized securities and FX between wholesale institutions. Both keep money inside regulated, permissioned networks. Neither is something a company uses to pay a contractor in Bogotá. ## Where do stablecoins fit among the five? They are the only open option. A dollar stablecoin moves on public blockchains, 24/7, between any two parties that can reach it, and the Fed's FEDS Note describes the GENIUS Act's reserve rules: backing in deposits, short-term Treasuries, and Federal Reserve balances. The trade-off is the edges. The BIS stresses that fiat access "remains dependent on exchange-based on- and off-ramps," and that stablecoin to fiat liquidity is thin outside a handful of currencies. Stablecoins also sit next to bank-side upgrades rather than against them. Swift is building its own [payments scheme and ledger](/resources/more/swift-instant-cross-border-scheme-vs-stablecoins), and the BIS paper's own conclusion is that the future "will therefore depend as much on governance and regulatory compliance as on technological innovation." ## Which option can a business use for Latin America payouts today? A wire, a money transfer operator, or a stablecoin converted into local currency. The four official-sector projects don't cover these corridors for business users yet. The stablecoin route works because Latin America's domestic rails are fast. Pix in Brazil, SPEI in Mexico, and Transfers 3.0 in Argentina settle in minutes once the money is local. The stablecoin carries value across the border; the local rail does the last mile. [Stablecoins plus local rails](/resources/more/stablecoins-local-rails-latin-america) shows how a payment lands in each country. ## How does BlindPay handle this? BlindPay is the off-ramp at the end of the stablecoin route. You send USDC or USDT from Ethereum, Polygon, Base, Arbitrum, Tempo, Arc, Stellar, Solana, or Tron, and BlindPay pays local currency over Pix, PIX Safe, TED, SPEI, ACH Colombia, Transfers 3.0, ACH, RTP, SEPA, Faster Payments, and SWIFT (POBO/COBO) with UETR tracking and MT103 confirmations. Each payout quote locks the rate and fees for 5 minutes before you commit. KYC and KYB run in the same API, so the compliance work regulators expect from any rail is part of the flow. ## What to do next List your top three payout corridors and mark which of the five approaches reaches each one today. For most Americas corridors, that leaves a wire, an MTO, or a stablecoin payout. Then price a real payment on each with the [cost per delivered dollar](/resources/more/cost-per-delivered-dollar) method.