Swiss National Bank's CBDC pilot project enters its third phase: expanding participation of financial institutions and extending for another two years

Reuters reported that the Swiss National Bank (SNB) has publicly announced its intention to expand its wholesale central bank digital currency (CBDC) pilot project in the hopes of attracting more banks to participate and increasing transaction volume. The project is currently in its third phase, which began in December last year and was originally scheduled to end last month, but the SNB now claims it will continue for at least another two years.

Swiss National Bank's CBDC Pilot Program Shows No Signs of Slowing Down

Antoine Martin, a member of the Swiss National Bank's Governing Board, announced at the Point Zero Forum 2024 held in Zurich yesterday that they are expanding the coverage of their wholesale CBDC pilot program to attract more financial institutions.

The pilot program, known as "Project Helvetia," aims to support transaction settlements by issuing real-time wholesale CBDC through SDX, the digital exchange arm of the Swiss stock exchange SIX. The specific progress of the project includes:

• Phase One: Launched in October 2019, primarily testing real-time clearing and settlement systems between SIX banks and SDX. Phase One Report
• Phase Two: Involving commercial banks, integrating wholesale CBDC into core banking systems, and conducting end-to-end transactions. Phase Two Report
• Phase Three: Transitioning wholesale CBDC activities from a testing environment to a real-world environment

The Swiss National Bank is launching a CBDC pilot program, with wholesale CBDC equivalent to bank reserves.

The participants in the second phase include financial giants such as Citigroup and Goldman Sachs, while the third phase will involve six financial institutions including UBS and Deutsche Bank.

As part of the program, participating banks have issued six digital bonds through SDX, with a total transaction value of 750 million Swiss francs, approximately 830 million U.S. dollars.

Swiss National Bank Chairman Thomas Jordan previously mentioned at a press conference last month that they are open to extending the Project Helvetia, originally scheduled to end this month, for at least another two years.

Jordan emphasized at the time that the pilot program positions SNB as a "global leader" in deploying wholesale CBDC in a real-world environment:

We hope that over time, more financial institutions will participate and wholesale CBDC will be used for a wider range of financial transactions.

Swiss National Bank's Digital Note Issuance Reaches $70 Million

Additionally, SNB revealed at the press conference that they successfully started issuing one-week "central bank digital notes" on SDX last month, with the current issuance reaching 64 million Swiss francs, approximately 71.6 million U.S. dollars.

In anticipation of the future expansion of the pilot program, SNB stated that they will continue to inform other financial institutions on how to participate:

Through the continuation of Project Helvetia, the Swiss National Bank is supporting innovation in the financial sector. The success of the pilot program in the future will depend on the participation of new financial market participants, an increase in transaction volume, and more financial market transactions settled on the platform.

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