Quick answer: The Regulated Liability Network (RLN) is a proposed shared-ledger settlement system where regulated money, both central bank money and commercial bank deposits, is issued as tokens on a common platform. The Federal Reserve Bank of New York’s innovation center (the NYIC) ran a 12-week proof of concept with 10 financial institutions and Swift in 2022 and published the findings in July 2023. The study used simulated data and concluded the concept was technically feasible, with no legal barriers identified under existing U.S. rules.
Updated 07/17/2026. By Jake Claver. Educational content, not investment advice.
The phrase “tokenization moving into regulated markets” gets used loosely. The RLN work is one of the more concrete cases, because named institutions ran an actual experiment and both the New York Fed and Citi published what they found. This piece walks through what the network is, who tested it, what the results said, and where it sits relative to newer projects like the BIS-led Project Agora.
The point worth holding onto: RLN is a design concept and a completed research exercise, not a live production system. Everything below describes what participants built and observed in a controlled test.
What the Regulated Liability Network actually is
The RLN concept keeps the familiar two-tier money structure: a central bank at the base and regulated private issuers (commercial banks) on top. What changes is the form. Instead of sitting in separate ledgers that reconcile through messaging and correspondent chains, each institution’s liabilities are represented as tokens on a shared distributed ledger. Central bank money and commercial bank deposit tokens live on the same platform and settle together.
Citi’s RLN whitepaper frames the potential benefit directly: a network of regulated issuers and instruments that could offer a new global settlement infrastructure, where tokenized, programmable money is interoperable across different regulated issuers while preserving the two-tier split between public and regulated private balance sheets. Citi’s Digital Dispatch explainer covers the same idea in plainer terms.
The design goal is a payment system that runs around the clock, settles close to real time, and carries programmability (conditional payments, automated liquidity management) without leaving the regulated perimeter. That last part matters: RLN is deliberately built inside existing bank regulation, not as an alternative to it.
The New York Fed’s NYIC and the proof of concept
The New York Innovation Center (NYIC) is a unit inside the Federal Reserve Bank of New York that studies financial technology, including central bank digital currency and tokenized settlement, often alongside the BIS Innovation Hub. It is a research function, not a policy-making or product-launching arm.
In November 2022 the NYIC announced a 12-week proof of concept to test the RLN concept with members of the U.S. financial sector. The NYIC has since summarized the wholesale settlement work on its facilitating wholesale digital asset settlement page. The Fed was consistent about scope from the start: participation in the experiment was not a signal that the Fed would issue a digital dollar or that any particular design was favored.
Who participated
- Financial institutions: BNY Mellon, Citi, HSBC, Mastercard, PNC Bank, TD Bank, Truist, U.S. Bank, and Wells Fargo
- Payments network: Swift
- Technology providers: Digital Asset and SETL
- Legal analysis: Sullivan & Cromwell
What the 2023 results showed
The findings landed in July 2023. The New York Fed published a research summary, and Citi issued a matching press release. The takeaways broke into three tracks:
- Business: The study found that a global, near real-time, 24/7 dollar payment system could in principle be delivered through the RLN concept, with potential improvements to cross-border dollar transactions.
- Technical: The platform demonstrated settlement finality, shared transaction data, privacy protections, and smart-contract features for liquidity management. It tested two scenarios, domestic interbank payments and cross-border dollar payments, both settling in a simulated wholesale central bank digital currency.
- Legal: The legal analysis identified no barriers under existing U.S. law that would prevent building the RLN as tested, while noting that further regulatory engagement would be needed for any real deployment.
Two honest caveats sit on top of all of this. The experiment ran on simulated data, not real customer money, and the central bank leg was a theoretical wholesale CBDC, not an actual Fed liability. The proof of concept answered “could this work technically and legally?” It did not commit anyone to build it.
Where RLN sits next to Project Agora and the BIS work
RLN is one thread in a wider body of central bank research on tokenized settlement. The Bank for International Settlements has pushed the same core idea further with Project Agora, a public-private effort with eight central banks (covering major reserve currencies) and more than 40 private financial firms coordinated through the Institute of International Finance. Agora tests tokenizing central bank reserves and commercial bank deposits on a shared programmable platform for atomic, multi-currency cross-border settlement, essentially the RLN design scaled to multiple currencies.
For the conceptual groundwork, the BIS reports on wholesale central bank money and technology and the CPMI’s tokenisation concepts report set out the vocabulary and design questions these experiments are working through.
Why this matters
Most cross-border and interbank settlement today runs through messaging plus separate ledgers that reconcile after the fact, which is where delay, cost, and settlement risk creep in. A shared-ledger model where regulated money settles atomically is an attempt to remove that reconciliation gap without leaving the regulated banking system. Whether it ever ships depends on regulatory decisions, not just a successful test, but the RLN work is a documented data point on what large institutions and a Fed research center were willing to build and verify together.
One thing this material does not do: it does not name any specific public cryptocurrency. The RLN and NYIC sources describe tokenized bank deposits and a theoretical wholesale CBDC on permissioned bank infrastructure. Do not read XRP, XLM, XDC, or HBAR into these documents unless a primary source names them, because the RLN sources do not.
Common questions
What is the Regulated Liability Network in simple terms?
It is a proposed settlement system where regulated money, both central bank money and commercial bank deposits, is issued as tokens on one shared ledger so it can settle together in near real time, around the clock, while staying inside existing bank regulation.
Did the Federal Reserve build or launch a digital dollar through RLN?
No. The New York Fed’s innovation center ran a 12-week research proof of concept using simulated data and a theoretical wholesale central bank digital currency. The Fed stated that participation did not signal any decision to issue a digital dollar.
Who took part in the RLN proof of concept?
The participants were BNY Mellon, Citi, HSBC, Mastercard, PNC Bank, TD Bank, Truist, U.S. Bank, Wells Fargo, and Swift, with Digital Asset and SETL providing technology and Sullivan & Cromwell handling the legal analysis, coordinated with the New York Innovation Center.
What were the main findings of the RLN study?
The 2023 results found the concept technically feasible, capable of near real-time 24/7 dollar settlement with settlement finality and privacy protections, and identified no legal barriers under existing U.S. rules, while noting that further regulatory engagement would be required for any real deployment.
How is RLN related to Project Agora?
Project Agora is a later BIS-led effort that applies the same tokenized-settlement idea across multiple currencies, with eight central banks and more than 40 private firms testing atomic multi-currency cross-border settlement.
This content is educational only. It is not tax, legal, or investment advice. Check primary sources and speak with a qualified professional before making financial decisions.
