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    Swiss National Bank, Citigroup, and Goldman Tested a Joint CBDC Project: Report

    Abstract:The Swiss National Bank and five other giant banks informed they managed to integrate CBDCs into the banking systems.

      The Swiss National Bank (SNB), together with five other banking giants, have reportedly tested whether they can process central bank digital currencies within the nations financial network. The institutions revealed they were able to integrate CBDCs into their existing core banking systems.

      The Latest CBDC Trial in Switzerland

      A January 13 coverage by Bloomberg disclosed that Switzerlands central bank and five commercial banks successfully employed CBDCs to settle transactions. These large institution included Citigroup Inc, UBS Group AG, Goldman Sachs Group Inc, Credit Suisse Group AG, and Hypothekarbank Lenzburg AG.

      The banks conducted the trial as part of an experiment known as “Project Helvetica,” which aims to identify the details around issuing wholesale central bank digital currencies.

      The SNB pointed out that none of the existing cryptocurrency platforms are “systemic” to support CBDC settlements as of the moment. As such, the goal of the test was to determine whether those exchanges can integrate such functions. Andrea Maechler – Governing Board Member of the Swiss National Bank – said:

      “It allowed the SNB to deepen its understanding of how the safety of central-bank money could be extended to tokenized asset markets.”

      It remains unclear when the team will launch the next phase of “Project Helvetica.” Despite being successful, there are still some issues which the trial did not cover. These include cybersecurity and processing a large number of transactions.

      The group outlined that the project remains “an exploratory nature,” and people should not interpret that the nations central bank will issue a wholesale CBDC.

      France Also Tested Its CBDC

      Switzerland is not the only European country to conduct experiments on its digital form of national currency. In October last year, Banque de France – the French central bank – completed a similar 10-month test. The project was led by the Belgian financial services company Euroclear, while many leading local banks participated, too.

      Throughout the experiment, the institutions examined how a CBDC will interact with Frances debt market. They traded government bonds and settled the transactions with the financial product issued by the central bank over the 10-month trial program.

      The project also tested the usefulness of such a digital token on a range of everyday activities such as paying coupons, issuing new bonds, redeeming deals, and respectively employing them in repurchase agreements.

      Isabelle Delorme – Deputy Chief Executive of Euroclear France – described the initiative as a success. She said it showed that “the central bank digital currencies can settle central bank money safely and securely.”

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