As part of the second phase of Project Helvetia, the Swiss National Bank integrated a wholesale CBDC into the financial systems of five commercial banks.
Switzerland has taken another step in defining its strategy for integrating central bank digital currencies, or CBDCs, into the present financial system.
The Swiss National Bank (SNB), the country’s central bank, and its partners completed the second phase of Project Helvetia by integrating a wholesale CBDC into the existing back-office systems and processes of five banks: Citi, Credit Suisse, Goldman Sachs, Hypothekarbank Lenzburg, and UBS.
In Phase 2 of Project Helvetia, which took place in the fourth quarter of 2021, the Bank for International Settlements and Swiss financial infrastructure service provider SIX joined the SNB as partners.
Project Helvetia, envisioned as a multi-phase inquiry into the settlement of tokenized assets in central bank money, intends to prepare central banks for a future in which tokenized financial assets based on distributed ledger technology are the standard. The project is focused on resolving operational, legal, and policy concerns associated to settlements. According to the official release, the lack of an existing systemic DLT-based platform does not rule out the possibility of such platforms in the future.
Switzerland was an appropriate location for the experiment since the law allows for the issuance of a wholesale CBDC — which is particularly used to settle interbank transfers and related wholesale transactions — on a distributed DLT platform maintained and owned by a private enterprise.
According to the release, the second phase of Project Helvetia investigated the settlement of interbank, monetary policy, and cross-border transactions on the test systems of SIX Digital Exchange, SIX Interbank Clearing — the Swiss real-time gross settlement system — and core banking systems.
“To continue fulfilling their mandates of ensuring monetary and financial stability, central banks need to stay on top of technological change,” said Andréa Maechler, a member of the SNB’s governing board. She went on, saying:
“Project Helvetia is a prime example of how to achieve this. It allowed the SNB to deepen its understanding of how the safety of central bank money could be extended to tokenized asset markets.”
The first phase of Project Helvetia began in December 2020, with the goal of issuing a wholesale CBDC.
