“Swiss Central Bank Head Endorses Advantages of Wholesale Digital Currency”


Swiss National Bank Chairman Thomas Jordan recently stated that a retail central bank digital currency (CBDC) is not necessary, as there are already efficient payment options available in the private sector. Instead, the SNB is focusing on improving the current system and addressing the risks that are causing disruptions.

One option being explored is a wholesale CBDC, as demonstrated through the SNB’s Project Helvetia III initiative. This involves settling bond issues using CBDCs, which has proven to be a simple and effective solution for transaction settlement. Jordan also highlighted the benefits of central banks printing their own money instead of relying on unsafe asset settlements.

However, there are important considerations that need to be addressed before implementing a wholesale CBDC. These include overnight holding, compensation, and access for financial institutions. The SNB is conducting a thorough examination of reports and wholesale CBDCs using the Swiss franc.

Based on this consideration, it seems that the SNB will take a cautious approach to CBDC implementation and only move forward after addressing operational challenges and carefully evaluating the advantages and disadvantages of wholesale implementation.

In addition, Clearstream has joined the European Central Bank’s trials for a digital euro wholesale CBDC, further showcasing the growing interest and developments in this area. This progress is being closely monitored by the SNB, and further updates and developments are expected in the near future.

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