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Swiss National Bank and BIS complete digital currency proofs-of-concept

The Bank of International Settlements and the Swiss National Bank are exploring the advantages of implementing a central bank digital currency (CBDC), using blockchain technology.

According to a Dec. 03 announcement, the BIS Innovation Hub Swiss Centre (BISIH), has completed two proofs-of-concept linking existing payment systems to a distributed ledger and settling tokenized assets with a wholesale CBDC. 

Known as “Project Helvetia,” the new initiative is a joint venture from the BISIH, the SNB and Switzerland’s top stock exchange, Six Group.

According to cointelegraph, the exchange said that Project Helvetia explored the technological and legal feasibility of transferring digital assets through issuing a wholesale CBDC onto Six’s proprietary distributed digital asset platform, Six Digital Exchange. The latest platform is expected to launch in the immediate future, offering issuance, trading, settlement, management and custody of tokenized assets. 

The financial institutions noted that the experiment should not be interpreted as an indication that Switzerland’s central bank will issue a wholesale CBDC. 

Andréa Maechler, a member of the SNB’s governing board stated: 

“Irrespective of which technologies the financial markets adopt next, the safety and reliability of Swiss financial infrastructure must be preserved. If [distributed ledger technology] can deliver significant improvements in securities trading and settlement, then the SNB will be prepared.”

While Project Helvetia seems to show that DLT has the potential to be a useful tool in the future of the financial system and CBDCs, there is still no clear consensus over whether the technology is obligatory for launching a CBDC.

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