The Swiss National Bank (SNB) has extended the CBDC wholesale trial by at least two more years as more institutions are expected to join the program.
The Swiss National Bank (SNB), the central bank of Switzerland responsible for the nation’s monetary policies, has announced that it will extend the digital Franc experimental program until at least 2026 in response to the increased adoption of blockchain technology and web3 payments.
Antoine Martin, a member of the SNB’s Governing Board, stated in a Bloomberg report that the bank will persist with its ongoing wholesale Central Bank Digital Currency (CBDC) experimental program in the years ahead.
The wholesale CBDC pilot program of the SNB, which was established in December of last year and intended to conclude by June 30 of this year, has been an enormous success. The SNB is now committed to enlisting additional institutions as participants in the wholesale CBDC pilot program.
“The volume of transactions will significantly influence the future success of the pilot project, the addition of new financial market participants, and the settlement of additional financial market transactions on this platform,” Martin stated.
The SNB bank has collaborated with SIX, the Swiss stock exchange provider, and several other commercial institutions, including Commerzbank AG and UBS Group AG. Martin emphasized that the bank’s pledge to extend the pilot program fails to ensure the final introduction of the digital Franc.
Additionally, the SNB’s decision to introduce the wholesale product will be contingent upon the overall demand for the digital Franc.
The SNB issued at least five bonds on SIX’s digital exchange in Zurich during the wholesale CBDC program. This included a $226 million settlement for a World Bank bond earlier this month.
Swiss National Bank Competes for Global Reserve Status
The utilization of CBDCs has recently intensified the competition to dethrone the United States dollar as the dominant global reserve currency. Coinspeaker recently reported that an increasing number of global central banks are investigating the implementation of a CBDC. Nevertheless, the Fed-backed CBDC has prompted many regulators in the United States to express apprehension regarding its potential privacy implications.
Numerous central banks worldwide have implemented retail CBDCs, including the People’s Bank of China.
The Chinese government continues to advocate for the ongoing de-dollarization by utilizing the digital Renminbi (RMB). Additionally, the GZ nations have been significantly threatened by China’s leadership in the BRICS movement.
Based on its security and privacy policies, the SNB aims to entice additional financial institutions to utilize its wholesale CBDC. Additionally, Switzerland has established a reputation for offering exceptional banking services free from global geopolitical interference.
The continuous development and implementation of various CBDCs significantly benefit the web3 industry and crypto assets. The utilization of CBDCs enables a more significant number of institutions to offer crypto-related services to a broader global audience in a seamless manner.
