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The Swiss National Bank has successfully used a wholesale CBDC to transact with five commercial banks, the monetary authority said. The tests are part of an experiment carried out jointly with the Bank for International Settlements and the Swiss financial services provider number six.
The Swiss Central Bank is testing the integration of wholesale CBDC with private banks.
a wide-range of transactions involving a wholesale central bank digital currency (cbdc) have been processed during the second phase of project helvetia, the swiss national bank (snb) revealed in a press release issued on thursday.
The trials are carried out under a joint initiative between the SNB, the Bank for International Settlements (bis), and six, the leading provider of financial infrastructure services in Switzerland. Five commercial banks also took part: citi, credit suisse, goldman sachs, hypothekarbank lenzburg et ubs.
The experiment, that was in the last quarter of 2021, explored the interbank settlement, monetary policy, and cross-border transactions on the test systems of six digital exchanges (sdx), the swiss real-time gross settlement system six inter-bank compensation (sic), and basic banking systems, snb detailed.
The Swiss Central Bank and other banks have integrated a wholesale CBDC into their existing administrative systems and processes. Snb notes that in the future, a growing number of financial assets will be sacrificed while financial infrastructure will be operated using distributed LEDGER technology (dlt). Regulators may need to hedge tokenised asset markets in their monetary policies, the authority stated and developed:
international regulatory standards suggest that operators of systemically important infrastructures should settle obligations in central bank money whenever practical and available. while none of the existing dlt-based platforms are systemic yet, they may become so in the future.
"To continue to fulfill its mandate of ensuring monetary and financial stability, central banks must keep abreast of technological change. Helvetia project... has enabled the snb to deepen its understanding of how the security of the central bank's currency could be extended to the tokenized asset markets", said andrea m. maechler, member of the bank's board of directors.
The Swiss National Bank notes that helvetia is only an exploratory project, suggesting that it should not be considered a wholesale CBDC issue project. in december, the snb, along with the bank of france and bis, carried out another experiment, testing the application of wholesale cbdc in cross-border payments. The Jura project was also supported by private sector companies.
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