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The Swiss National Bank (SNB) has announced the launch of a wholesale central bank digital currency (CBDC) project in partnership with six commercial banks. The banks involved in the project are UBS, Credit Suisse, Zürcher Kantonalbank, Postfinance, the Swiss Cantonal Banks, and Bank J. Safra Sarasin.
The SNB’s CBDC project is part of a larger effort by the Swiss government to explore how digital currencies can improve the financial infrastructure. The project focuses on “experimenting with digital currencies as an efficient and secure means of payment between financial market infrastructures (FMIs) and financial institutions”.
The project is being designed to ensure interoperability between different FMI systems in Switzerland, and to increase automation and efficiency within the Swiss financial sector.
The project will involve tests to evaluate how digital currencies can facilitate payments between different FMIs, as well as how they can be integrated into existing systems. The tests will be limited to the participating financial institutions, and no CBDCs will be made available to the public at this time.
The SNB noted that the project is still in its early stages, and that further development of the technology is needed before a CBDC becomes available to the public. The project is expected to run until at least 2022.
In addition to exploring the technical viability of a CBDC in Switzerland, the project also aims to identify potential regulatory and legal issues associated with digital currencies. The project will help to prepare the Swiss financial sector for the potential use of digital currencies in the future.