Polygon joins BoE Digital Pound Lab Phase 2 for stablecoin tests

The Bank of England has brought Polygon Labs into Phase 2 of its Digital Pound Lab to test whether stablecoins and a simulated central bank digital currency can settle opposite sides of the same cross-border trade payment.

Polygon Labs has entered Phase 2 of the Bank of England's Digital Pound Lab, partnering with NOBO Finance and Dun & Bradstreet to test near-instant cross-border settlement and portable credit identities for small businesses using its Open Money Stack technology.

"Interoperability is what gets value moving, and it is what Polygon's Open Money Stack is built to enable," Marc Boiron, chief executive officer of Polygon Labs, said. "Regulators and central banks are asking the right questions, and we are glad to be part of that conversation at the infrastructure level."

The consortium is running two workstreams. The SME Bankable Profile, led by NOBO Finance with Dun & Bradstreet supplying verified business identity and credit data, aims to build a reusable credit identity that small and medium-sized enterprises can carry across lenders and markets. The second tests eBL-backed invoice factoring with multi-rail settlement: an exporter receives financing through a stablecoin rail while a UK importer settles the final payment in digital pounds. Polygon provides the stablecoin settlement infrastructure and smart contracts through its Open Money Stack on the Polygon network, while the digital pound leg clears on the Bank of England's simulated systems.

The experiments run from November 2025 to July 2026 in a controlled environment with no real customers, funds, or regulatory assessments. Participation does not constitute endorsement by the Bank of England of Polygon or its offerings. Insights will inform joint evaluations by the Bank of England and HM Treasury on next steps for a digital pound, as the global trade finance gap — the difference between what SMEs need and what banks provide — runs into the trillions of dollars.

Two workstreams target SME trade finance

The SME Bankable Profile combines consented wallet activity, open finance data, and commercial intelligence to produce a reusable credit outcome. Dun & Bradstreet contributes business and risk data from its Commercial Graph, while Polygon provides smart-contract infrastructure for verifiable records, consent management, and deal lifecycles. NOBO Finance, which completed Phase 1 of the Lab by demonstrating conditional B2B escrow payments for trade finance, leads the effort.

"Smoother trade finance for SMEs depends on trust — and that starts with reliable business identity and risk data," Ayo Ojerinola, chief executive officer of NOBO Finance, said. "By bringing the D&B Commercial Graph into NOBO's work in the Bank of England's Digital Pound Lab, we are helping build trust between trading partners and financial institutions."

Why interoperability matters

The broader motivation centers on fragmentation in today's financial systems. Traditional bank money, stablecoins, tokenized deposits, and potential central bank digital currencies often operate on disconnected rails, which can trap liquidity and reintroduce settlement risk when different forms of value cannot exchange efficiently at par and on demand. The Open Money Stack was built so settlement does not hinge on proximity to any single rail.

The Lab runs as an experimental venue rather than a pathway to immediate policy decisions or product launches. Insights gathered as Phase 2 concludes may inform joint evaluations by the Bank of England and HM Treasury regarding future steps on digital currency. The tests come as central banks worldwide weigh hybrid models where blockchain-enabled stablecoins and central bank digital currencies complement one another in trade finance, potentially streamlining processes for exporters, importers, and smaller businesses that face lengthy settlement times and limited access to credit.

This article is for informational purposes only and does not constitute investment advice.