Alexander Savenkov Swiss Central Bank Chairman Thomas Jordan has announced plans for the issuance of a wholesale central bank digital currency (CBDC) through SIX Digital Exchange, a subsidiary of SIX, a financial infrastructure operator in Switzerland and Spain. The Swiss National Bank (SNB) aims to conduct a pilot project involving the CBDC, but remains cautious about launching a retail CBDC at this time.
During the Point Zero Forum, Jordan emphasized that the pilot CBDC initiative is not merely an experiment, as it will involve the use of actual money equivalent to bank reserves. The objective is to test real transactions with market participants, ensuring a practical approach to the project. The SNB plans to commence the pilot in the near future, with a limited duration.
The Swiss central bank’s decision aligns it with other countries that have already introduced CBDCs or are currently exploring their implementation. According to a Reuters report, the motivation behind these initiatives is to retain control of digital payments within the public sector and prevent excessive influence by private entities.
Although the SNB acknowledges the possibility of introducing retail CBDCs in the future, Jordan stated that the bank currently maintains a cautious stance on the matter. While retail CBDCs are not ruled out entirely, the SNB prefers to exercise prudence in their approach.
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Frequently Asked Questions (FAQs) about Wholesale CBDC
What is the Swiss Central Bank’s plan regarding the issuance of a wholesale central bank digital currency (CBDC)?
The Swiss Central Bank, also known as the Swiss National Bank (SNB), plans to conduct a pilot project for a wholesale CBDC. It intends to issue the CBDC via SIX Digital Exchange, a subsidiary of SIX, which operates financial infrastructure in Switzerland and Spain.
How will the pilot CBDC project be carried out?
The pilot CBDC project will involve real money equivalent to bank reserves. The objective is to test real transactions with market participants, ensuring a practical and operational approach to the project. The pilot is expected to commence soon and will run for a limited period.
Why is the Swiss Central Bank cautious about launching a retail CBDC?
The Swiss Central Bank is currently cautious about launching a retail CBDC. While it does not rule out the possibility of introducing retail CBDCs in the future, the bank is exercising prudence. It aims to carefully assess the implications and potential challenges associated with retail CBDCs before proceeding with their implementation.
What is the motivation behind the Swiss Central Bank’s CBDC initiatives?
The Swiss Central Bank, like its counterparts in other countries, aims to retain control of digital payments within the public sector. By exploring CBDC initiatives, the central bank seeks to avoid excessive influence by private entities and ensure the preservation of monetary policy and financial stability.
How does the Swiss Central Bank’s plan align with global trends?
The Swiss Central Bank’s plan to issue a wholesale CBDC aligns it with other countries that have already introduced CBDCs or are actively studying them. The objective is to stay at the forefront of digital currency developments, enabling the central bank to adapt to evolving financial landscapes while maintaining control over the monetary system.
More about Wholesale CBDC
- Swiss National Bank
- SIX Digital Exchange
- Central Bank Digital Currency (CBDC)
- CBDC Pilot Projects
- Digital Payments and CBDCs
- Financial Stability and CBDCs
5 comments
swiss central bank being careful with retail cbdc. smart move. need to evaluate risks and challenges before jumping in.
other countries already launching cbdcs or studying them. swiss central bank keeping up with the trend. digital payments future!
wow, swiss central bank joining the cbdc game! pilot on six digital exchange. hope it’s a success!
swiss central bank want to launch wholesale cbdc. interesting move. not sure about retail cbdc though. why so cautious?
real transactions with market participants using cbdc? that’s cool! can’t wait to see how it plays out.