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Blockchain

The French central bank’s blockchain-based CBDC pilot project for debt markets

October 19, 2021 - Around 2 mins mins to read
France Trials CBDC, Blockchain for Government Bond Deals

The French central bank continues to actively investigate a central bank digital currency (CBDC), completing a major test of a blockchain-based CBDC in the country’s debt market.

More than 500 institutions in French participated in a 10-month trial to test CBDCs issued by the Banque de France for transactions in government bonds, the Financial Times reported on October 19.

The CBDC study is led by Belgian financial services company Euroclear and uses a system developed by US technology giant IBM.

The CBDC also took part in the French National Debt Office, along with the central bank and a consortium of large financial firms operating in France, including BNP Paribas, Crédit Agricole CIB, HSBC and Societe Genérale.

As part of the experiment, participants traded government bonds and security tokens and paid for them using a CBDC provided by the central bank. The project tested the use cases of CBDCs in a number of day-to-day operations, such as issuing new bonds, using them in repurchase agreements, and paying coupons and deals.

“Together we have successfully measured the inherent benefits of this technology and have concluded that central bank digital currencies are liquid,” said Isabelle Delorme, CEO of Euroclear.

According to Soren Mortensen, Global Director of Financial Markets at IBM, the project “goes beyond previous blockchain initiatives” as it has successfully tested “most central securities custody processes and central banks” while eliminating existing intermediate steps such as mediation between market brokers.

The French system: in all its gloire | The Good Schools Guide

Related: The G7 heads of state and government issue guidelines on central banks’ digital currencies

After the start of the CBDC pilot program in March 2020, the French central bank continuously tested various CBDC use cases. In June, the Banque de France, in cooperation with the Swiss crypto bank SEBA, tested a CBDC to simulate the processing and distribution of listed securities. Previously, the central bank piloted the CBDC to issue simulated stocks valued at $ 2.4 million through a private blockchain platform.

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#Adoption

#Banks

#BNP Paribas

#Central bank

#Europe

CBDC

France

IBM

SECOND

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Annie

Championing positive change through finance, I've dedicated over eight years to sustainability and environmental journalism. My passion lies in uncovering companies that make a real difference in the world and guiding investors towards them. My expertise lies in navigating the world of sustainable investing, analyzing ESG (Environmental, Social, and Governance) criteria, and exploring the exciting field of impact investing. "Invest in a better future," I often say. That's the driving force behind my work at Coincu – to empower readers with knowledge and insights to make investment decisions that create a positive impact.
Blockchain

The French central bank’s blockchain-based CBDC pilot project for debt markets

France Trials CBDC, Blockchain for Government Bond Deals

The French central bank continues to actively investigate a central bank digital currency (CBDC), completing a major test of a blockchain-based CBDC in the country’s debt market.

More than 500 institutions in French participated in a 10-month trial to test CBDCs issued by the Banque de France for transactions in government bonds, the Financial Times reported on October 19.

The CBDC study is led by Belgian financial services company Euroclear and uses a system developed by US technology giant IBM.

The CBDC also took part in the French National Debt Office, along with the central bank and a consortium of large financial firms operating in France, including BNP Paribas, Crédit Agricole CIB, HSBC and Societe Genérale.

As part of the experiment, participants traded government bonds and security tokens and paid for them using a CBDC provided by the central bank. The project tested the use cases of CBDCs in a number of day-to-day operations, such as issuing new bonds, using them in repurchase agreements, and paying coupons and deals.

“Together we have successfully measured the inherent benefits of this technology and have concluded that central bank digital currencies are liquid,” said Isabelle Delorme, CEO of Euroclear.

According to Soren Mortensen, Global Director of Financial Markets at IBM, the project “goes beyond previous blockchain initiatives” as it has successfully tested “most central securities custody processes and central banks” while eliminating existing intermediate steps such as mediation between market brokers.

The French system: in all its gloire | The Good Schools Guide

Related: The G7 heads of state and government issue guidelines on central banks’ digital currencies

After the start of the CBDC pilot program in March 2020, the French central bank continuously tested various CBDC use cases. In June, the Banque de France, in cooperation with the Swiss crypto bank SEBA, tested a CBDC to simulate the processing and distribution of listed securities. Previously, the central bank piloted the CBDC to issue simulated stocks valued at $ 2.4 million through a private blockchain platform.

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