Swiss Banks Collaborate on Digital Swiss Franc Bonds


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).

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).

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.





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