The Swiss National Bank (SNB) in Bern, Switzerland
The Swiss National Bank (SNB) in Bern, Switzerland, September 3, 2019. Arnd Wiegmann/Reuters

The Swiss National Bank (SNB) has partnered up with the SIX Digital Exchange (SDX) to explore how Central Bank Digital Currency (CBDC) can be used in the settlement of tokenized assets, SDX announced on 8 October.

According to the announcement, SDX will be working on a proof-of-concept for the study in collaboration with Switzerland’s central bank and the Bank of International Settlement’s (BIS) Innovation Hub Centre

As part of the effort, SDX will provide its platform as a way to explore how CBDCs can be integrated into a Distributed ledger Technology (DLT) platform.

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The CEO of SIX, Jos Dijsselhof, said:

“We are pleased to contribute to this initiative and, through SIX Digital Exchange, to explore the technological possibilities with which the SNB could support token-based financial ecosystems in the future by providing digital central bank money for financial market participants.”

The press release further noted that a DLT-based tokenized assets and CBDCs have the potential to reduce counterparty risk, as well as stimulate the creation of new financial innovations.

SDX will also explore the technical options around the digitization of the Swiss franc, and the connection of the existing Swiss Interbank Clearing System.

Thomas Zeeb, Head of Securities and Exchanges at SIX, said:

“Our proof of concept on the subject of digital central bank money for financial market participants on DLT platforms will not only provide technological insights. but will also send an important signal to all market participants to take steps to explore DLT technology and digital assets.”

Bank in June, an executive of the Bank for International Settlements, also known as the central bank for central banks, said that BIS has been supporting other banks in their effort to research and develop a CBDC.

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