Swiss Financial Institutions Collaborate to Launch Wholesale CBDC Project

Revolutionizing Digital Financial Markets

A consortium of Swiss financial institutions is embarking on an exciting endeavor that aims to transform digital financial markets. The Helvetia Phase III project, set to explore the use of wholesale central bank digital currency (wCBDC), will mark a significant milestone in the adoption of real Swiss Franc wCBDC for settling digital securities transactions.

A Collaborative Effort

This groundbreaking initiative is a result of collaboration between SIX, the Swiss National Bank (SNB), and six commercial banks, including Banque Cantonale Vaudoise, Basler Kantonalbank, Commerzbank, Hypothekarbank Lenzburg, UBS, and Zürcher Kantonalbank. The pilot program, scheduled to run from December 2023 to June 2024, will pave the way for a new era of digital finance.

Utilizing Cutting-Edge Technology

The transactions will take place on the SIX Digital Exchange (SDX) platform, a leading distributed ledger technology (DLT)-based platform. Leveraging the infrastructure from Swiss Interbank Clearing SIC and SIX SIS, along with the CO:RE trading platform for repo transactions administered by the Triparty Agent of SIX SIS, the project promises to integrate the latest advancements in digital finance.

Driving Digital Asset Adoption

The participating banks will issue digital Swiss Franc bonds settled against wCBDC on a delivery-versus-payment basis using digital bonds that are eligible for SNB repo transactions. This innovative approach highlights the potential of distributed ledger technology to catalyze the adoption of digital assets, potentially shaping the future of the global financial industry.

A New Era of Digital Finance

David Newns, Head of SDX, expresses his confidence in the initiative’s potential impact on the financial sector. He believes that this project will usher in a new era of digital finance. The pilot program will thoroughly assess wCBDC transactions within a live production environment and extend to repo transactions initiated on the CO:RE trading platform.

Setting a Precedent

Building upon the insights gained from earlier phases by BIS Innovation Hub, SNB, SIX, the success of this project could potentially set a precedent for future digital currency initiatives worldwide. The project is poised to revolutionize the financial landscape and drive innovation in the digital asset space.

Unlocking the Future of Finance

This pioneering collaboration between Swiss financial institutions marks a significant step forward in the adoption of wholesale central bank digital currency. By leveraging cutting-edge technology and fostering collaboration, the project aims to unlock the full potential of digital finance and shape the future of the global financial industry.