- The Swiss National Bank (SNB) reveals plans to pilot a Swiss Franc (CHF)-based Central Bank Digital Currency (CBDC) on the SIX Digital Exchange, marking a milestone in digital currency evolution.
- Despite the experimental nature of this project, the CBDC will be “real money” backed by the SNB and will serve as a testbed for real transactions with market participants.
At the Point Zero Forum banking conference held in Zurich, Thomas Jordan, the Chairman of the Swiss National Bank (SNB), announced the impending pilot of a Swiss Franc (CHF)-based Central Bank Digital Currency (CBDC). While a specific rollout date was not disclosed, Jordan emphasized the CBDC would see the light of day sooner rather than later. This aligns with the Bank for International Settlements’ (BIS) forecast, which, in collaboration with the SNB, envisages a functioning CBDC prototype by mid-2023 as part of ‘Project Tourbillon,’ an ambitious exploration into the world of cryptocurrencies.
The Swiss CBDC will be available on the SIX Digital Exchange for a limited period. SIX, a subsidiary of the SIX Group, also oversees Switzerland’s main stock exchange, one of the largest in Europe. Even though this initiative is essentially a trial run to determine the feasibility of a larger eCHF roll-out, Jordan confirmed that the CBDC would be regarded as “real money”, fully backed by the SNB. The primary objective of this pilot is to evaluate real transactions with market participants in the emerging field of CBDCs.
In a separate discussion at the same conference, Andrea Maechler, the Governor of the SNB, emphasized that the introduction of CBDCs wouldn’t jeopardize the existence of cash. She stated that the feature of holding central bank money would remain intact, irrespective of the technology adopted.
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The move to test a CBDC is a testament to Switzerland’s continual research in the crypto domain, especially given their previous refusal to consider blockchain-based reserves. Recognized as a global leader in the banking sector, Switzerland consistently prioritizes its citizens’ financial stability, even when open to exploring cutting-edge technical solutions in finance and beyond. This CBDC test run further solidifies Switzerland’s reputation as a nation that continually bridges the gap between traditional banking and the evolving world of digital currencies.
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