Swiss central bank readying cross-border digital currency test

LONDON: Switzerland’s central bank is planning its first digital currency test with another country, one of its governing board members said on Thursday. Dozens of central banks around the world are looking to launch digital currencies in the coming years, but it will be vital that they can be exchanged and used in transactions abroad without issues.

On Switzerland’s next steps, Thomas Moser, an alternate member of the Swiss National Bank’s governing board said during a digital currency event, “We will try some cross-border functionality.”

“There will be another central bank and another currency other than the Swiss franc. It will be the real thing, there is no simulation. There will be another central bank with their system, so it is going to be as if we were going live.”

Moser would not reveal who the other central bank would be. It will be a landmark in Europe but some of Asia’s central banks have already piloted similar steps. Last year, the Hong Kong Monetary Authority (HKMA) and Bank of Thailand developed a prototype to transfer central bank digital currency funds and make payments between themselves.

China’s central bank, which is well advanced with a digital yuan, said in February that it would join the ‘Multiple CBDC Bridge’ currently run by the Hong Kong and Thai central banks and the Bank for International Settlements.