SNB continues project for digital central bank money for two years
Published: Thursday, Jun 20th 2024, 11:01
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The Swiss National Bank (SNB) intends to continue its pilot project with digital central bank money (Central Bank Digital Currency CBDC) for at least two years. The SNB is confident that further financial institutions will gradually participate, said SNB Director Antoine Martin on Thursday as part of the monetary policy assessment.
"The Helvetia III project has been very successful so far," Martin told the media. With the participation of further institutions, digital central bank money could be made available for a broader range of financial transactions. The financial institutions will be informed about the possibilities for participation in due course.
First DLT-based monetary policy operation
As part of the Helvetia III project, the SNB has been providing digital central bank money for financial institutions since December 2023. It issues this on the SIX Digital Exchange (SDX), which is based on blockchain or distributed ledger technology (DLT). This means that transactions with token-based bonds in Swiss francs can be settled directly on the SDX in central bank money, as Martin explained.
A total of six banks (BCV, BKB, Commerzbank, Hypothekarbank Lenzburg, UBS and ZKB) are currently participating in the ongoing pilot operation of Project Helvetia III. To date, they have processed six issues of digital bonds with transactions totaling around 750 million Swiss francs. At the beginning of June, the SNB even became the first central bank to carry out a DLT-based monetary policy operation: It issued digital SNB Bills on the SDX.
Digitale Transformation
By continuing the pilot operation of Project Helvetia, the SNB is supporting the private sector in its efforts to innovate, Martin emphasized to the media. "Its success will largely depend on whether new financial market participants join, whether the transaction volume increases and whether additional financial market transactions are processed on this platform."
The continuation of the Helvetia pilot project represents an important milestone and paves the way for broader acceptance of the token ecosystem, SDX wrote in a separate press release on Thursday: "This is an important step in the digital transformation of the financial sector."
However, the SNB Director also emphasized on Thursday that the pilot operation does not constitute a commitment on the part of the SNB to introduce wholesale CBDC or digital SNB Bills on a permanent basis.
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