Economy 5 min read By Bethany Hadley
Saudi Arabia Exits China's mBridge Payment Platform in Blow to De-Dollarisation Push
Saudi Arabia has quietly withdrawn from China's mBridge digital payment platform, removing a key participant from Beijing's effort to build an alternative to the dollar-dominated SWIFT system. The Saudi Central Bank completed its proof of concept in May 2025 and is no longer a participating member.
Saudi Arabia has quietly withdrawn from China's mBridge digital payment platform, dealing a setback to Beijing's ambitions of building a cross-border payments system that could reduce global reliance on the US dollar. The Saudi Central Bank, known as SAMA, confirmed it is no longer a participating member after completing a proof of concept on 13 May 2025.
China launched mBridge in 2021 as a way for central banks to settle transactions directly using digital currencies and blockchain technology, bypassing the dollar-dominated SWIFT network. The original participants were China, Hong Kong, Thailand, the United Arab Emirates and the Bank for International Settlements, the Basel-based institution often described as the central bank for global central banks.
Saudi Arabia joined in 2023 as an observing member under the BIS umbrella while researching central bank digital currencies, and took part in work during 2024 to build a proof of concept. In a statement, SAMA said it had completed that exercise as planned and was no longer involved. A person familiar with the matter said the Saudi central bank did not wish to remain publicly associated with the project.
The withdrawal matters because Saudi Arabia sits at the heart of the so-called petrodollar system, the arrangement dating from a 1974 deal under which Riyadh priced its oil in dollars and invested its surpluses in US assets. That system helped entrench the greenback across global commerce, and the dollar is now used in roughly 90 per cent of worldwide transactions. Because oil is a core input for manufacturing and transport, supply chains have a built-in incentive to keep dealing in dollars.
Deutsche Bank noted in March that the world saves in dollars in large part because it pays in dollars, and that the currency's dominance in cross-border trade is arguably built on the petrodollar, with globally traded oil priced and invoiced in US currency. Middle Eastern oil and gas also feed into petrochemicals, fertiliser and even helium, which is critical to semiconductor manufacturing.
The greenback has nonetheless faced growing challenges since US sanctions cut Russia off from the dollar-based financial system following the invasion of Ukraine in 2022. Other countries have worried they could face similar measures and have moved to reduce their exposure to dollar-denominated assets. Central banks have been buying gold while trimming holdings of US Treasuries, and Saudi Arabia has previously explored pricing some oil sales to China in yuan. Iran and Russia have used the Chinese currency to work around US sanctions.
Analysts at Deutsche Bank have warned that the conflict with Iran could put further strain on the dollar. If Tehran succeeds in requiring other countries to pay in yuan to secure safe passage through the Strait of Hormuz, it could give rise to a «petroyuan», they suggested, adding that the conflict may expose fault lines by challenging the US security umbrella for Gulf infrastructure and maritime security for global oil trade.
The BIS left mBridge in October 2024 after the United States reportedly lobbied it to exit, though the institution said it had «graduated out» and denied any political considerations. When asked whether Saudi Arabia came under US pressure to withdraw, a source said it would be inaccurate to draw any wider inference.
Despite the departures, mBridge has continued to make progress and recently added Macau as a participant. A report from the Atlantic Council earlier this year found that transactions on the platform had surged to more than $55bn, a roughly 2,500-fold increase since 2022. Alisha Chhangani of the Atlantic Council told Reuters in January that mBridge was unlikely to challenge dollar dominance directly but might incrementally erode it.
Beijing has also extended currency swap agreements with other central banks and promoted yuan-based transactions with major trading partners as part of its broader effort to reduce the dollar's role in global finance.
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