The Swiss National Bank (SNB) and the Bank for International Settlements (BIS) plan to test a central bank-backed digital currency (CBDC) by the end of this year. According to the Chinese news outlet The Paper, BIS official Benoit Coeure revealed the plan on Sunday at the Bund Summit held in Shanghai. Coeure said the Swiss central bank and the BIS would issue a CBDC “in the proof-of-concept stage” by the end of 2020. This proof-of-concept will pave the way for experimenting with retail CBDC, according to Coeure, who heads the BIS Innovation Hub researching digital currencies.
The BIS also plans to work with more central banks.
In the future, the Bank for International Settlements also plans to work with more central banks, including the Hong Kong Monetary Authority and the Bank of Thailand, to test cross-border usage of digital currencies, said Coeure. The SNB and the BIS first partnered in October 2019 to explore digital currencies. At the time, the SNB said: “This new form of digital central bank money would be aimed at facilitating the settlement of tokenized assets between financial institutions.”
Central banks across countries experiment with CBDCs.
Many countries around the world are now showing an increased interest in CBDCs. Earlier, the U.S. Federal Reserve chairman, Jerome Powell, suggested the United States was waiting to get the right proposals in place, rather than becoming the first to launch in regard with a CBDC. Several other major central banks, including the Bank of Japan, the Philippines’ central bank, are working on a CBDC. On the other hand, China has become the first major nation to go ahead with its national digital currency. Chinese consumers spent $8.8 million in digital yuan during the first week of the trial.