BIS explores digital cash privacy after bank data breaches

• The Bank for International Settlements has examined privacy-enhancing technologies for digital cash in the second phase of Project Aurum.
• The research explores how digital payments could protect personal data while supporting regulatory compliance.
• The project highlights the challenge of limiting data exposure if financial institutions suffer cyberattacks.

The Bank for International Settlements has published Project Aurum Phase 2, a prototype exploring privacy safeguards for digital cash.

The project examines how digital payments can protect personal and transaction data without removing safeguards needed for regulatory compliance.

The prototype uses privacy-enhancing technologies to balance user confidentiality against transaction transparency and compliance requirements.

The prototype aims to reduce unnecessary exposure of personal and transaction data while maintaining compliance and payment integrity.

Project Aurum Phase 2 builds on an existing prototype and adds configurable features for compliance and operational needs.

The research explores how privacy protections can be built into digital cash technology rather than relying solely on institutional safeguards.

The BIS says the prototype can help central banks assess trade-offs between privacy, transparency, compliance and other digital payment requirements.

The project remains exploratory, offering policymakers a framework for evaluating privacy-preserving digital cash rather than a production-ready payment system.