The Swiss National Bank (SNB) has announced that it will issue a Central Bank Digital Currency (CBDC) on Switzerland’s SIX digital exchange.
Speaking at a conference in Zurich, SNB President Thomas Jordan announced that SNB will issue CBDC wholesale on Switzerland’s SIX digital Exchange as part of a pilot.
Emphasizing that this is not just an experiment, Jordan said, “There will be real money equivalent to bank reserves and the aim is to test real transactions with market participants.”
On the other hand, as the sharp fluctuations in the markets last year increased the regulation and supervision demands for cryptocurrencies and stablecoins, which are concerned about their reliability, it is also noteworthy that the global interest in CBDCs is intensifying.
CBDC is defined as the digital version of a country’s official currency.
The fact that they are produced based on a center is shown as the most basic feature that distinguishes CBDCs from cryptocurrencies such as Bitcoin. There is no central authority that manages cryptocurrencies created using distributed ledger technology and distributed over digital networks.
CBDCs have some advantages and disadvantages over physical money.
Advantages such as encouraging financial inclusion by providing easy and secure access to money, improving competition and durability in domestic payments, increasing efficiency and reducing transaction costs in payments, creating programmable money and improving transparency in money flows, ensuring uninterrupted and easy flow of monetary and fiscal policy money development motivation.
According to a report by the International Monetary Fund (IMF) on the subject, CBDCs are expected to have significant effects on monetary policy, financial stability and the international monetary system.
The IMF’s report states that CBDC research has accelerated during the COVID-19 pandemic, often in response to the emergence of crypto assets.
According to data from the Atlantic Council, 114 countries representing more than 95 percent of the global economy are actively researching CBDCs.
While it is noteworthy that the researches of countries in this area are intensified, in May 2020, only 35 countries are included in the records that evaluated CBDCs.