Home News Swiss National Bank ready to run with wCBDC in January

Swiss National Bank ready to run with wCBDC in January


Swiss National Bank (SNB) has completed testing of the wholesale central bank digital currency (wCBDC). Governing board member Thomas Moser, in an interview with CoinDesk, said that the technical launch could take place in January 2022 if there is a political decision.

Thus, if approved, the regulator will use licensed Six Digital Exchange (SDX). “I would say we would be ready to go live in January, and it just takes a policy decision and the question of whether we legally could do a wholesale CBDC. But technically we would be ready to go live with a wCBDC on SDX,” the official said.

The experiment within the Helvetia project with the support of the Bank for International Settlements (BIS) started in 2019. In December 2020, its participants reported the success of CBDC trials for settlements on tokenized assets. The legal and technical possibilities of their translation were studied.

Helvetia project

To date, the second phase of the Helvetia project has been completed, the report on which will be published in January. It implied the integration of wCBDC into the infrastructures of five banks. Moreover, the publication recalled that Citibank, JPMorgan and Credit Suisse were previously mentioned among the participants.

The missing link in the scheme was the necessary Swiss Financial Market Supervisory Authority (FINMA) licenses for SDX operation. In September, the platform received them. The first real transactions will take place in November.

The combination of digital cash and a distributed ledger technology (DLT) – SDX uses Corda from R3 – allows for “atomic settlement”. “Everyone complains about slow T+1 and T+2, but they give banks time. Atomic settlement makes the liquidity management for banks more complicated, and there are still interesting questions about costs and benefits,” Moses commented. He also noted that the regulator prefers CBDC, not stablecoins.

The need for a digital franc

Previously in June, SNB chief economist Carlos Lenz questioned the need for a digital franc. During a press conference organized by the Swiss Bankers Association (SBA), Lenz noted that the existing payment system works well and, accordingly, there is no need for a digital currency.

Earlier in 2019, the Swiss government did not find any benefits from the release of retail CBDC. But recognized some benefits from its wholesale option.

The Council noted that some economists expect digital currencies to improve the efficiency of payments and monetary policy. As well as strengthen the stability of the financial system as a whole. A number of CBDC supporters are confident that its use will reduce tax crimes and help in the fight against money laundering.

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