The Saudi Central Bank has withdrawn from the mBridge project, a cross-border payments platform led by China, that utilizes central bank digital currencies. According to the Financial Times, Saudi Arabia had initially participated as an observer in 2023 before becoming an active participant in the development and testing of the platform. The withdrawal comes as the project aims to create an alternative to traditional payment systems dominated by Western nations.
The mBridge project is part of China's efforts to develop an international payment infrastructure that reduces reliance on the US dollar. This has raised concerns in the United States that it could give China greater influence in setting global payment standards related to privacy, security, and interoperability. The project uses blockchain technology to facilitate direct transactions between central banks using their digital currencies, reducing the need for the US dollar as an intermediary.
The Saudi Central Bank stated that its exit from the project was in line with its original participation plan. The bank had joined the project in 2024, along with China, Hong Kong, Thailand, the United Arab Emirates, and the Bank for International Settlements. The platform's development and testing phases were completed, with a proof-of-concept experiment conducted in 2024 and a full-scale test on May 13, 2025.
The Bank for International Settlements had also exited the project in October 2024, with its former CEO stating that the bank had fulfilled its role and the project was ready to be handed over to participating central banks. The Financial Times previously reported that Washington had pressured the bank to withdraw, although the bank's former CEO denied that the decision was driven by politics or project failure.
The mBridge project's goals align with China's broader efforts to internationalize its currency and challenge the US dollar's dominance in global trade. The project's use of blockchain technology and central bank digital currencies could potentially reduce transaction costs and increase the efficiency of cross-border payments.
Saudi Arabia's withdrawal from the project may be seen as a strategic move, given the country's existing relationships with both China and the United States. The Kingdom has been strengthening its economic ties with China, while also maintaining close diplomatic and security relationships with the US.
The future of the mBridge project and its potential impact on global payment systems remain uncertain. As countries continue to explore the use of central bank digital currencies and blockchain technology, the international payment landscape may undergo significant changes in the coming years.
Key points
- Saudi Arabia has withdrawn from China's mBridge project, a cross-border payments platform aimed at reducing reliance on the US dollar.
- The project uses blockchain technology and central bank digital currencies to facilitate direct transactions between central banks.
- The withdrawal comes as the project faces scrutiny from the United States, which is concerned about China's growing influence in global payment systems.
