France and Switzerland are testing CBDC
A new CBDC search brings together banks from France and Switzerland under the aegis for global settlements.
In the project, the central banks of France and Switzerland are experimenting with crypto currencies CBDC. The financial platforms are cooperating with the innovation for international settlements and the private sector. The focus is on cross-border payment transactions between institutions. The cooperation are thus testing a so-called wholesale CBDC and none for individual transactions.
The central banks of this world are cautiously approaching the topic of CBDC in order to counteract the spread of private currencies - at the same time, the first available CBDC promises the issuing and the associated country considerable first-mover advantages. This creates a conflict: implementation decisions have to be carefully considered, while at the same time there is a race to be the first CBDC to bring a digital currency to the market.
Accenture Also Leads The Sector Involved In The CBDC Test
The banks like Credit Suisse and UBS as well as the crypto companies will be there. The test itself includes on the one hand a euro-based CBDC and one that maps the franc. A French currency is also part of the package. Because two cross-border settlements are being tested.
In the first case, a delivery-payment model is the subject of the experiment. The partners swap the Euro-CBDC for the financial industry. In the second case, however, one payment is offset by another. As a result, the two CBDCs change hands here: inside. Banks from both countries are involved in the transactions.
The G20 has made improving cross-border payments a priority and has drawn up a year roadmap to redirect efforts. The test contributes to this work by examining how a wholesale CBDC could improve speed, efficiency and transparency in cross-border use cases.
The contents of this article are for informational purposes only and are not investment advice.