The Bangko Sentral ng Pilipinas (BSP) has taken a significant step in its pursuit of Central Bank Digital Currency (CBDC) innovation by selecting Hyperledger Fabric as the core technology for its pilot project, Project Agila. This move reflects the BSP's commitment to exploring the potential of CBDCs to enhance the efficiency of large-value payment systems in the Philippines. Project Agila and Its Objectives Project Agila, formerly known as Project CBDCPh, is a collaborative effort involving various local financial institutions, with technical support from international organizations. The primary goal of this project is to evaluate the capabilities of CBDC technology, specifically in enabling inter-institutional fund transfers, even outside regular business hours. Why Hyperledger Fabric and Distributed Ledger Technology (DLT)? The BSP's decision to opt for Distributed Ledger Technology (DLT) is rooted in its ability to record, share, and synchronize data and transactions across a network of participants. This technology aligns perfectly with Project Agila's unique use case, which involves facilitating fund transfers between institutions during non-business hours or when the existing system, PhilPaSSplus, is unavailable. Hyperledger Fabric emerged as the chosen technology following an extensive evaluation process that included system demonstrations, procedural walkthroughs, and scoring based on various metrics like access, security, availability, interoperability, and programmability. Notably, the BSP referred to Hyperledger as a DLT in its press release, rather than explicitly labeling it as a blockchain, despite the technology's association with blockchain principles. Understanding the Role of CBDCs Central Bank Digital Currencies (CBDCs) represent a digital form of a nation's currency, with the central bank holding direct liability. In the wholesale format, CBDCs find utility in settling interbank payments, securities transactions, and cross-border payments. Future Prospects and International Collaborations Upon the completion of Project Agila, participants anticipate gaining a deeper understanding of CBDC technology. The assessment results will serve as a roadmap for the BSP and the financial industry, potentially leading to the adoption of wholesale CBDCs in the Philippines. Key participants in Project Agila include major local banks such as BDO Unibank, Inc., China Banking Corp., Land Bank of the Philippines, Rizal Commercial Banking Corporation, Union Bank of the Philippines, and fintech firm Maya Philippines, Inc. Additionally, future phases may involve other financial institutions like Citibank N. A. Manila, China Bank Savings, Wealth Development Bank Corporation, and SeaBank Philippines, Inc. The BSP is also actively collaborating with international organizations like the International Monetary Fund and the Bank for International Settlements Innovation Hub to ensure that the pilot project adheres to global standards in technical aspects, risk management, and governance. Next Steps and the Sandbox Environment Following the selection of Hyperledger Fabric as the technology of choice, Project Agila's participants will embark on testing the application of wholesale CBDC technology within a sandbox environment, alongside the existing PhilPaSSplus system. The ultimate objective is to enhance the efficiency and safety of the national payment system using insights gained from this innovative project. In summary, the BSP's choice of Hyperledger Fabric for Project Agila signifies a significant leap towards harnessing CBDC technology's potential to transform large-value payment systems in the Philippines, with implications for the broader financial industry and international collaborations.