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What Is BRICS Bridge (mBridge) and Why Does It Matter?
Under India's 2026 BRICS chairship, the bloc is advancing mBridge — a blockchain-based cross-border payment platform that uses central bank digital currencies (CBDCs) to bypass the SWIFT network and reduce dependence on the US dollar. With settlement times dropping from days to seconds and costs approaching zero, mBridge represents the most tangible de-dollarization infrastructure yet deployed. The dollar's share of global foreign exchange reserves has fallen to 56% in 2025, its lowest level in 30 years, according to IMF COFER data. Meanwhile, US-China trade has shrunk by 30%, and over $165 billion in trade flows have been redirected along geopolitical lines, per McKinsey's 2026 Global Trade Update.
How mBridge Works: A Technical Overview
Project mBridge was launched in 2021 by the Bank for International Settlements (BIS) Innovation Hub, the Hong Kong Monetary Authority, and the central banks of Thailand, the UAE, and China. Saudi Arabia joined as a full participant in 2024. The platform uses a permissioned distributed ledger — the mBridge Ledger — compatible with the Ethereum Virtual Machine, enabling commercial banks to transfer wholesale CBDCs directly peer-to-peer with atomic settlement in roughly 15 seconds. By eliminating correspondent banking intermediaries, transaction costs drop from the current 6–8% to near zero.
Under India's proposal, all BRICS nations would link their domestic CBDCs — India's e-Rupee, China's digital yuan (e-CNY), Brazil's Drex, Russia's digital ruble, and others — into a unified settlement framework. India's Reserve Bank has drawn on the successful UPI-PayNow model linking India and Singapore, advocating for bilateral CBDC interoperability corridors that preserve each country's monetary sovereignty and data governance.
The Geopolitical Context: De-Dollarization Accelerates
The mBridge initiative arrives at a pivotal moment. The dollar's share of global reserves has declined from 72% in 2001 to 56.32% in Q2 2025, a 30-year low. While 92% of the 2025 decline stemmed from exchange rate movements rather than active selling, the 2022 freezing of Russia's $300 billion in Western-held reserves fundamentally altered risk perceptions. BRICS central banks have since accumulated over 2,100 tonnes of gold, and the bloc now holds roughly 20% of the world's official gold reserves.
The McKinsey Global Trade Report 2026 confirms that global commerce is fracturing along geopolitical lines. US-China trade has contracted by 30%, while ASEAN exports grew 14% — more than double the global average — as supply chains reconfigure. China has evolved into a 'factory to the factories,' exporting intermediate goods such as smartphone components and lithium-ion batteries for final assembly in Southeast Asia. This reconfiguration creates natural demand for a payment system that operates outside dollar-dominated corridors.
The BIS Withdrawal and Its Implications
In a significant development, the BIS announced its withdrawal from mBridge in late 2024, with CEO Agustín Carstens stating the project was not intended to circumvent sanctions or threaten the dollar. The BIS declared mBridge 'graduated' as a public good, allowing participating central banks to continue independently. Critics argue the withdrawal reflects Western concerns that mBridge could enable sanctions evasion, particularly for Russia and Iran. However, developers insist the platform's governance structure — with equal voting rights for all participants — remains intact, and it will continue to comply with international anti-financial crime standards.
The BIS withdrawal from mBridge has raised questions about the project's future direction, with some analysts speculating that China may now take a leading role. Nevertheless, the platform's minimum viable product stage was reached in June 2024, and commercial banks including HSBC, Goldman Sachs, and Tencent have conducted real-value transactions. By January 2026, mBridge had processed approximately $55 billion in cumulative transaction volume across more than 4,000 transactions.
Impact on Global Financial Stability and Sanctions Enforcement
The operational launch of mBridge under India's chairship represents the most consequential shift in global payments architecture since the creation of SWIFT in 1973. For multinational corporations, the implications are profound. Treasury operations must prepare for a multipolar digital currency settlement environment where transactions can settle in seconds outside traditional correspondent banking networks. Supply chain financing, trade credit, and foreign exchange risk management will all be affected.
From a sanctions enforcement perspective, mBridge poses both challenges and opportunities. While the platform could theoretically enable transactions that bypass US dollar clearing, its permissioned architecture and compliance with international standards mean it is not inherently a sanctions-evasion tool. India has insisted that any de-SWIFTing must retain robust compliance and traceability, emphasizing de-risking without abandoning regulatory standards.
The future of SWIFT in a multipolar world remains uncertain. SWIFT processed over 44 million messages daily in 2025, but its dominance is being challenged by multiple CBDC platforms. The European Central Bank is developing its own digital euro settlement system, while the BRICS bloc advances mBridge. This fragmentation could reduce systemic risk by eliminating single points of failure, but it also creates complexity for global financial institutions operating across multiple payment corridors.
Expert Perspectives
Economists remain divided on the significance of mBridge. "mBridge is the most tangible de-dollarization development in years, but internal BRICS divergences may slow progress," notes a senior analyst at the Atlantic Council's GeoEconomics Center. The Reserve Bank of India has taken a pragmatic approach, advocating for corridor-specific limits and no offshore e-rupee circulation to maintain monetary control.
Meanwhile, the dollar still settles approximately 88% of global foreign exchange transactions, and no clear replacement currency has emerged. The Chinese renminbi accounts for just 2.1% of global reserves. As one former IMF official put it, "The dollar is not losing its reserve status entirely — but its monopoly is eroding gradually."
Frequently Asked Questions
What is BRICS Bridge (mBridge)?
BRICS Bridge, formally known as Project mBridge, is a blockchain-based cross-border payment platform that uses central bank digital currencies (CBDCs) to enable instant, low-cost international settlements without relying on the SWIFT network or the US dollar.
When will mBridge become operational?
mBridge reached its minimum viable product stage in June 2024 and is launching operationally in 2026 under India's BRICS chairship. Commercial banks have already conducted real-value transactions on the platform.
How does mBridge differ from SWIFT?
SWIFT is a messaging network that facilitates correspondent banking, with settlement taking 3–5 days and costing 6–8%. mBridge uses distributed ledger technology for atomic settlement in seconds at near-zero cost, bypassing intermediary banks.
Can mBridge be used to evade sanctions?
The platform's permissioned architecture includes compliance with international anti-financial crime standards. While it reduces reliance on dollar clearing, it is not designed as a sanctions-evasion tool. India has emphasized that any de-SWIFTing must retain robust traceability.
What does mBridge mean for the US dollar?
mBridge contributes to the gradual erosion of the dollar's dominance in trade settlement, but the dollar remains the world's primary reserve currency, settling 88% of forex transactions. The shift is toward a multipolar system rather than outright replacement.
Conclusion: A Multipolar Payments Future
The launch of mBridge under India's 2026 BRICS chairship marks a watershed moment for global finance. While the dollar's entrenched advantages — deep capital markets, rule of law, and network effects — will not disappear overnight, the infrastructure for a multipolar payment system is now operational. For businesses, policymakers, and investors, the message is clear: the era of a single dominant payments architecture is giving way to a more fragmented, but potentially more resilient, global financial system. The BRICS de-dollarization strategy 2026 is no longer theoretical — it is being built, block by block.
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