The Swiss National Bank and Six Commercial Banks to Pilot Wholesale CBDC Issuance
The Swiss National Bank (SNB), in collaboration with six commercial banks and the SIX Swiss Exchange, is set to pilot the issuance of wholesale central bank digital currencies (CBDCs) in Switzerland. This initiative, known as the Swiss franc wCBDC, aims to test the effectiveness of a Swiss Franc wCBDC in settling digital securities transactions.
The Helvetia Phase III Pilot Project
The pilot project, named Helvetia Phase III, is dedicated to wholesale CBDCs and builds upon the findings of the first two phases conducted by the BIS Innovation Hub, SNB, and SIX. It will be hosted on SDX (SIX Digital Exchange) and leverage the infrastructure of Swiss Interbank Clearing. The pilot is scheduled to run from December 2023 to June 2024.
Participating Banks and Test Environment
Six banks are involved in the pilot: Banque Cantonale Vaudoise, Basler Kantonalbank, Commerzbank, Hypothekarbank Lenzburg, UBS, and Zürcher Kantonalbank. These banks are already members of SDX. During the pilot, they will issue digital Swiss franc bonds that will be settled against wCBDC on a delivery-versus-payment basis. All transactions will be collateralized by digital bonds and settled on SDX using wCBDC.
Collaboration and Cross-Border Initiatives
In addition to the CBDC efforts within Switzerland, the Swiss Financial Market Supervisory Authority has partnered with regulatory authorities from Japan, the United Kingdom, and Singapore’s Monetary Authority of Singapore (MAS) to conduct various crypto pilot initiatives. These pilots focus on fixed income, foreign exchange, and asset management products. The MAS emphasizes the need for closer cross-border collaboration among policymakers and regulators as these initiatives continue to grow in scale and sophistication.
Hot Take: Swiss National Bank Collaborates with Banks for Wholesale CBDC Pilot
The Swiss National Bank, together with six commercial banks and the SIX Swiss Exchange, is embarking on a pilot project to explore the issuance of wholesale central bank digital currencies (CBDCs) in Switzerland. This pilot, called Helvetia Phase III, aims to assess the viability of a Swiss Franc wCBDC for settling digital securities transactions. The participating banks will issue digital Swiss franc bonds settled against wCBDC on SDX, using a delivery-versus-payment model. This initiative aligns with broader efforts by global regulatory authorities to explore the potential of CBDCs and foster cross-border collaboration in the crypto space.
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