Swiss Banks Collaborate on Digital Swiss Franc Bonds with Wholesale CBDC

by Tareq Sikder
  • Six commercial banks have joined forces for the pilot program.
  • Helvetia Phase III initiates real Swiss Franc settlements in digital securities transactions.
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Bloomberg

SIX, the Swiss National Bank (SNB), and six commercial banks have embarked on a pilot project with a focus on tokenized central bank money for financial institutions, commonly referred to as wholesale central bank digital currency (wCBDC).

Helvetia Phase III: Swiss Franc wCBDC Settlements

This initiative, known as Helvetia Phase III marks the first instance of orchestrating real Swiss Franc wCBDC for settling digital securities transactions. The pilot will be hosted on the digital asset platform of SIX Digital Exchange (SDX), a pioneering fully regulated financial market infrastructure for digital assets based on Distributed Ledger Technology (DLT).

Helvetia Phase III builds upon the insights and progress achieved during earlier phases of Project Helvetia, led by the BIS Innovation Hub, the Swiss National Bank, and the financial infrastructure operator SIX.

This collaborative endeavor involves several financial institutions, including Banque Cantonale Vaudoise, Basler Kantonalbank, Commerzbank, Hypothekarbank Lenzburg, UBS, and Zürcher Kantonalbank, which are all existing SDX member banks.

In addition to the SDX platform, the project leverages the infrastructure of Swiss Interbank Clearing SIC, operated by SIX, and SIX SIS, the national Central Securities Depository of the Swiss financial market, and an International Central Securities Depository.

Pilot Program Timeline: From December 2023 to June 2024

The pilot program is scheduled to run from December 2023 to June 2024. Its primary objective is to assess the settlement of primary and secondary market transactions in wCBDC within a live production environment. Participating banks will have the ability to issue digital Swiss Franc bonds, which will be settled on a delivery-versus-payment basis using wCBDC.

Jos Dijsselhof, CEO of SIX, commented: "Switzerland is at the forefront of digital financial innovation. This collaboration between SIX, the Swiss National Bank, and six commercial banks on the pilot operation for tokenized central bank money is a pioneering leap. It's a testament to our commitment to the future of digital finance and underscores the transformative power of DLT in the financial system."

Project Helvetia Phase III will extend to the settlement of repo transactions, which are initiated on the CO:RE trading platform of SIX Repo and administered by the Triparty Agent of SIX SIS. These transactions, conducted in test environments, will be collateralized by digital bonds eligible for SNB repo transactions and settled on SDX in wCBDC.

SIX, the Swiss National Bank (SNB), and six commercial banks have embarked on a pilot project with a focus on tokenized central bank money for financial institutions, commonly referred to as wholesale central bank digital currency (wCBDC).

Helvetia Phase III: Swiss Franc wCBDC Settlements

This initiative, known as Helvetia Phase III marks the first instance of orchestrating real Swiss Franc wCBDC for settling digital securities transactions. The pilot will be hosted on the digital asset platform of SIX Digital Exchange (SDX), a pioneering fully regulated financial market infrastructure for digital assets based on Distributed Ledger Technology (DLT).

Helvetia Phase III builds upon the insights and progress achieved during earlier phases of Project Helvetia, led by the BIS Innovation Hub, the Swiss National Bank, and the financial infrastructure operator SIX.

This collaborative endeavor involves several financial institutions, including Banque Cantonale Vaudoise, Basler Kantonalbank, Commerzbank, Hypothekarbank Lenzburg, UBS, and Zürcher Kantonalbank, which are all existing SDX member banks.

In addition to the SDX platform, the project leverages the infrastructure of Swiss Interbank Clearing SIC, operated by SIX, and SIX SIS, the national Central Securities Depository of the Swiss financial market, and an International Central Securities Depository.

Pilot Program Timeline: From December 2023 to June 2024

The pilot program is scheduled to run from December 2023 to June 2024. Its primary objective is to assess the settlement of primary and secondary market transactions in wCBDC within a live production environment. Participating banks will have the ability to issue digital Swiss Franc bonds, which will be settled on a delivery-versus-payment basis using wCBDC.

Jos Dijsselhof, CEO of SIX, commented: "Switzerland is at the forefront of digital financial innovation. This collaboration between SIX, the Swiss National Bank, and six commercial banks on the pilot operation for tokenized central bank money is a pioneering leap. It's a testament to our commitment to the future of digital finance and underscores the transformative power of DLT in the financial system."

Project Helvetia Phase III will extend to the settlement of repo transactions, which are initiated on the CO:RE trading platform of SIX Repo and administered by the Triparty Agent of SIX SIS. These transactions, conducted in test environments, will be collateralized by digital bonds eligible for SNB repo transactions and settled on SDX in wCBDC.

About the Author: Tareq Sikder
Tareq Sikder
  • 593 Articles
  • 4 Followers
About the Author: Tareq Sikder
A Forex technical analyst and writer who has been engaged in financial writing for 12 years.
  • 593 Articles
  • 4 Followers

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