Polygon Labs Joins NOBO Finance and Dun & Bradstreet in Phase 2 of the Bank of England's Digital Pound Lab

tl;dr

• Polygon Labs is participating in Phase 2 of the Bank of England’s Digital Pound Lab as part of a consortium with NOBO Finance and Dun & Bradstreet
• The Lab is a simulated test environment that enables the Bank and participants to test what’s possible for a digital pound and cross-border stablecoin settlement
• The consortium’s use case will test cross-border settlement, with the stablecoin leg supported by Polygon’s Open Money Stack and the digital pound leg settling in the Lab’s simulated environment
• The tests blend cross-border stablecoin settlement with a domestic tokenised digital pound, a working look at how different forms of programmable money can move as one
• Nothing tested here implies Bank of England endorsement of Polygon Labs, or any decision on what a digital pound will ultimately look like

Today, we’re excited to announce that Polygon Labs is participating in Phase 2 of the Bank of England’s Digital Pound Lab.

The Lab exists to test ideas and new technology in a simulated environment: no real customers, no real money, and no formal regulatory review attached to what gets tested inside it. Polygon Labs joins in Phase 2, alongside NOBO Finance and Dun & Bradstreet, as a consortium simulating test cross-border settlement.

Participants build against a simulated digital pound to explore the feasibility of different use cases in a platform which enables hands-on experimentation for industry and the Bank of England.

We get to experiment with how our own infrastructure handles digital pound mechanics without the cost, risk, or regulatory runway of a live pilot.

Cross-border settlement and the SME Bankable Profile

Phase 2 explores if a stablecoin and a digital pound can settle the same cross-border payment, in the same flow, without either side waiting on the other. The consortium exists to explore each workstream across the Lab.

Polygon is contributing to testing cross-border settlement: whether a stablecoin and a digital pound can settle the same cross-border payment, in the same flow, without either side waiting on the other. An exporter pays in stablecoins, an importer settles in a digital pound, and both legs move through one orchestration flow. We cover the stablecoin settlement leg and the smart contract infrastructure behind it, contributed through the Open Money Stack’s orchestration layer built on the Polygon network. The digital pound leg settles on the Bank of England’s simulated test rails.

Other members of the consortium are focused on different workstreams. SME Bankable Profile, led by NOBO Finance, is a portable credit identity for small businesses. NOBO designs and leads the use case, Dun & Bradstreet contributes the verified business identity and credit data that anchor each profile, and Polygon Chain provides the onchain infrastructure that lets the profile travel with the payment.

Why we’re testing this

Money today moves through separate rails that don’t talk to each other well: bank money, stablecoins, tokenised deposits and now, potentially, central bank digital currency.

That fragmentation sits at the centre of an open question for an institution: how can you move value across these forms without friction?

A client might pay in a stablecoin, a counterparty may expect a digital pound, the balance sheet sits in tokenized deposits. If those forms can’t settle against each other at par and on demand, liquidity gets trapped and settlement risk returns. Keeping money fungible, in whatever form it takes, is what makes the system hold together.

We built the Open Money Stack because settlement shouldn’t depend on which rail a business happens to be closest to.

The Lab gives us a controlled, low-stakes setting to test that thesis in the Bank’s simulated Lab environment, without a single real customer or real pound at risk. Rather than debate how different forms of programmable money should work together, we’re collaborating on a payments experiment that depends on it.

“For digital money to actually move the world’s trade, its different forms have to work together: public and private, central bank money and stablecoins. This experiment tests exactly that. Interoperability is what gets value moving, and it’s what our Open Money Stack is built to enable. Regulators and central banks are asking the right questions, and we’re glad to be participating in that conversation at the infrastructure level,” said Marc Boiron, CEO of Polygon Labs.

What this is, and isn’t

Our participation doesn’t imply Bank of England endorsement of Polygon Labs or its products, and the use cases we’re testing don’t indicate future Bank policy or the final design of a digital pound. They’re a way to learn, together with the Bank and other participants, what actually works before anyone builds it for real.

We’ll share what we learn as Phase 2 wraps up.