BIS joins CBDC testing in cross-border settlements

The BIS Innovation Hub, in collaboration with the monetary regulators of France and Switzerland, will conduct an experiment using a central bank digital currency (CBDC) in cross-border settlements.

#BISInnovationHub @banquedefrance and the Swiss National Bank launch #ProjectJura – a collaborative experiment into wholesale #CBDC @SNB_BNS_en https://t.co/vtbMCSJA6i pic.twitter.com/lV7mKI7R0S

— Bank for International Settlements (@BIS_org) June 10, 2021

The experiment, named Project Jura, will involve the Bank of France, the Swiss National Bank, and a consortium of private organisations led by consulting firm Accenture. The latter includes Credit Suisse, Natixis, R3, SIX Digital Exchange and UBS.

In the first stage of testing, the euro-pegged wholesale CBDC will be exchanged for a French digital instrument on a DLT-platform in accordance with the settlement mechanism “delivery against payment.”

In the second phase, there will be an exchange between euro- and franc-pegged wholesale CBDCs. Settlements will be conducted under the «payment against payment» mechanism.

The operations will be processed by banks located in Switzerland and France.

Project Jura is the continuation of the regulator’s broad French project in which participated a number of European institutions, including Accenture, HSBC and Societe Generale.

In January 2021, the Bank of France successfully tested a CBDC in a pilot project involving the issuance of tokenised shares of a currency fund worth more than €2 million.

Earlier, the European Central Bank warned of the risk to monetary sovereignty if large tech companies issue their own digital currencies and regulators do not have versions of them.