Switzerland’s central bank is exploring the potential of blockchain but is in no rush to produce digital cash. © Keystone / Gaetan Bally
Central Bank Digital Currency (CBDC) is the buzz-phrase of the moment. But the Swiss National Bank (SNB) says producing digital Swiss francs for the general public would create many problems with unclear benefits. The Swiss government has backed up the central bank word for word.
And it turns out that an SNB issued digital Swiss franc for institutional players (such as banks) is not a done deal either. “We are conducting cutting-edge research in this area but there are no plans to issue a wholesale CBDC at this time,” says the SNB’s Head of Banking Operations Sébastien Kraenzlin.
“Central banks need to be ready to respond

The Swiss franc is in such high demand that the central bank is imposing charges on stockpilers. (© Keystone / Gaetan Bally)
Swiss savers are being made to pay for global demand for the franc. The number of bank customers being charged negative interest rates on their deposits is on the rise – and shows no sign of reversing.
The problem for domestic savers stems from the popularity of the Swiss currency. Amid economic uncertainty worldwide and a paucity of return on many investments, people have taken to dumping their assets in the solid franc. They may not make much money, but they won’t lose anything either.
That’s until the Swiss National Bank (SNB) introduced negative interest rates in 2015 – literally charging domestic banks to deposit money (above a certain

The Swiss central bank produces paper money for general use, but will only contemplate digital currencies for specific industry use cases.
The Swiss stock exchange wants the country’s central bank to issue a form of cryptocurrency to settle payments on its new digital securities trading platform. If the Swiss National Bank (SNB) agrees, it would represent a departure from its cautious policy on digital currencies.
Stock exchange operator SIX Group revealed at the Crypto Valley Association conferenceexternal link that traders on its forthcoming SDX platform would be able to swap cash for a new digital token. This token would be used to pay for securities bought on the exchange and could be redeemed for cash when