BIS, De Nederlandsche Bank and the Deutsche Bundesbank are creating a data platform that has potential to shed light on the macroeconomic relevance of crypto-asset markets and decentralized finance (DeFi).
Project Atlas combines on- and off-chain information, “creating a layered approach to data vetting and tailored statistics for central banks.”
A first proof of concept was developed focusing “on international flows of crypto-assets.”
The Bank for International Settlements (BIS) and its partner central banks within the Eurosystem have “developed a proof of concept to explore the macroeconomic relevance of cryptoasset markets and DeFi.”
Project Atlas, a collaborative effort by the BIS Innovation Hub Eurosystem Centre, De Nederlandsche Bank and the Deutsche Bundesbank, “combines data gathered from crypto exchanges (called off-chain data) with granular data extracted from public blockchains (on-chain data).”
In this proof of concept phase, Atlas is “focusing on improving data collection methodology and platform development.”
While plenty of data on the industry are “currently available, the data are spread over many protocols, market actors and jurisdictions, and reporting is often not regulated or standardized.”
The project report details “how the proof of concept uses transactions between crypto exchanges in the Bitcoin network, along with the location of those exchanges, as a proxy for cross-border capital flows.”
Attribution data links on-chain transactions to crypto exchanges, “which are then mapped to their geographical location (where possible).”
The derived bilateral flows between countries are “visualized on a globe that presents the data in a user-friendly and easily accessible manner.” An initial analysis of preliminary data collected by the platform shows that cross-border flows “are substantial economically and unevenly distributed across geographical regions.”
According to a release, Project Atlas is a great example of what the BIS Innovation Hub can achieve.
Working in the intersection of economics, finance and computer engineering, the teams are developing what they claims is “a new and important public good for central banks globally.”
The data on cross-border flows “are relevant for areas like payments and macroeconomic analysis.”
For more details, check here.