On Dec. 1, the Swiss National Bank will be one of the first central banks in the world to introduce a real Swiss digital franc for the settlement of digital securities transactions for financial institutions. Six banks are involved in the pilot project, which will run until June 2024: Banque Cantonale Vaudoise, Basler Kantonalbank, Commerzbank, Hypothekarbank Lenzburg, UBS and Zürcher Kantonalbank.
Many fear the introduction of a digital currency as a replacement for physical money, but
there are two types of digitized central bank currencies, so-called CBDCs (short for central bank digital currency): the wholesale CBDC and the retail CBDC. The digital Swiss franc, which the SNB will be testing from Dec. 1, is a wholesale CBDC. It is only available to commercial banks and other financial institutions in their dealings with the Swiss National Bank and with each other (in interbank loans, for example).
