Societe Generale and the central bank of France ran a digital currency transaction. The bank made a transaction of €40 million of bonds issued as security tokens for digital euros. The central bank said the test transaction shows the feasibility of using blockchain technology for digital settlements at this scale. This trial was performed end-to-end using blockchain technology. It shows the feasibility of financial securities being digitally settled and delivered in Central Bank Digital Currency for interbank settlements, the central bank said.
The trial will help central banks worldwide in developing CBDCs.
A spokesperson for Societe Generale said that the experiment would help inform the central bank, along with other central banks worldwide, to develop central bank digital currencies. The spokesperson said that the results of these experiments would be a vital element of the Banque de France’s contribution to the more global reflection led by the Eurosystem on CBDC. This digital euro trial is one of the largest so far to take place in the Eurozone.
This digital euro trial could pave the way for European banks to issue CBDC.
The central bank of France could pave the way for other European banks to issue CBDCs in the future. This digital euro trial was one of the largest so far to take place in the Eurozone. This trial follows on from an April 2018 trial in which the Societe Generale issued bonds of €100 million on the blockchain, though at the team, these were settled in fiat euros. China is all set to become the world’s first major nation to issue a central bank digital currency. The digital yuan dubbed as DC/EP is expected to be launched sometime this year. The People’s Bank of China had earlier clarified that they are going ahead with the digital yuan as planned despite the ongoing pandemic.