Key Takeaways
- • Saudi Arabia's central bank (SAMA) quietly exited China's mBridge digital payment platform in May 2025 after completing a proof-of-concept, marking a significant setback for Beijing's de-dollarization strategy and weakening the initiative's credibility among major oil-producing nations.
- • mBridge, launched by China in 2021 as a blockchain-based alternative to the dollar-dominated SWIFT system, has lost two major institutional anchors within seven months—the Bank for International Settlements departed in October 2024 and Saudi Arabia followed in May 2025—suggesting waning momentum for the platform.
- • Saudi Arabia's withdrawal is strategically consequential because the kingdom underpins the petrodollar regime dating to 1974, when it agreed to price oil in dollars; its participation was viewed as validation that a major commodity producer would diversify away from dollar-settlement infrastructure.
- • The dollar remains entrenched in approximately 90% of global transactions despite China's multi-year effort to establish alternative payment rails, indicating structural headwinds to de-dollarization initiatives even with support from major emerging-market economies.
- • SAMA stated it withdrew after successfully completing its research phase, while sources indicated the central bank preferred not to maintain public association with mBridge; the timing and nature of the exit raise questions about geopolitical pressure, though the Saudi central bank declined to characterize any external influence.
Summary
Saudi Arabia's central bank has quietly withdrawn from mBridge, China's blockchain-based digital payment platform designed to challenge dollar dominance in global finance. SAMA completed its participation and proof-of-concept work on May 13, 2025, and subsequently ceased involvement in the initiative, according to statements reviewed by the Financial Times. The withdrawal represents a tangible setback for Beijing's de-dollarization agenda, particularly given Saudi Arabia's structural importance to the dollar-based international financial system.
The timing underscores weakening support for mBridge among systemically important institutions. The Bank for International Settlements, the operational coordinator for central bank cooperation, exited the platform in October 2024 after alleged U.S. lobbying pressure—though BIS denied political considerations, framing the departure as a natural "graduation" from the research phase. Saudi Arabia's May 2025 exit followed a similar trajectory: SAMA joined as an observer member under BIS sponsorship in 2023, participated in proof-of-concept development in 2024, and departed after completing its research mandate. However, sources told the FT that the Saudi central bank preferred not to maintain public visibility with mBridge going forward, suggesting reputational or strategic recalibration beyond technical completion of objectives.
Saudi Arabia's participation had been heralded as a strategic win for mBridge precisely because the kingdom serves as the foundational anchor of the modern petrodollar system—the 1974 bilateral agreement whereby Saudi Arabia priced oil exclusively in dollars and invested surpluses in U.S. assets. That arrangement subsequently expanded across commodity markets and global commerce, embedding dollar dominance into roughly 90% of all international transactions. A major oil producer's involvement with an alternative settlement mechanism carried symbolic weight for Beijing's broader de-dollarization efforts. The withdrawal therefore signals limited appetite among key commodity exporters to migrate away from established dollar infrastructure, even as China continues developing technological alternatives.
The platform originally launched in 2021 with backing from China, Hong Kong, Thailand, the United Arab Emirates, and BIS. Current active participants remain undisclosed, but the loss of two anchor institutions within months suggests that technical viability and blockchain efficiency may be secondary considerations relative to geopolitical alignment and institutional risk tolerance in the current environment. SAMA declined to characterize whether external pressure influenced its decision, stating only that withdrawal followed completion of planned research activities.
The timing underscores weakening support for mBridge among systemically important institutions. The Bank for International Settlements, the operational coordinator for central bank cooperation, exited the platform in October 2024 after alleged U.S. lobbying pressure—though BIS denied political considerations, framing the departure as a natural "graduation" from the research phase. Saudi Arabia's May 2025 exit followed a similar trajectory: SAMA joined as an observer member under BIS sponsorship in 2023, participated in proof-of-concept development in 2024, and departed after completing its research mandate. However, sources told the FT that the Saudi central bank preferred not to maintain public visibility with mBridge going forward, suggesting reputational or strategic recalibration beyond technical completion of objectives.
Saudi Arabia's participation had been heralded as a strategic win for mBridge precisely because the kingdom serves as the foundational anchor of the modern petrodollar system—the 1974 bilateral agreement whereby Saudi Arabia priced oil exclusively in dollars and invested surpluses in U.S. assets. That arrangement subsequently expanded across commodity markets and global commerce, embedding dollar dominance into roughly 90% of all international transactions. A major oil producer's involvement with an alternative settlement mechanism carried symbolic weight for Beijing's broader de-dollarization efforts. The withdrawal therefore signals limited appetite among key commodity exporters to migrate away from established dollar infrastructure, even as China continues developing technological alternatives.
The platform originally launched in 2021 with backing from China, Hong Kong, Thailand, the United Arab Emirates, and BIS. Current active participants remain undisclosed, but the loss of two anchor institutions within months suggests that technical viability and blockchain efficiency may be secondary considerations relative to geopolitical alignment and institutional risk tolerance in the current environment. SAMA declined to characterize whether external pressure influenced its decision, stating only that withdrawal followed completion of planned research activities.
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