A consortium of institutions led by Euroclear have completed a test run of the use of central bank digital currency (CBDC) for settling French treasury bonds on a blockchain.
The experiment, using ttechnology from IBM and commissioned by the Banque de France included Agence France Trésor, BNP Paribas CIB, Crédit Agricole CIB, HSBC, Societe Generale
The full scope of the project covered a large range of core securities settlement operations including securities issuance, primary market and secondary market trades, liquidity optimisation mechanisms like repo and interest payments. In total, 500 instructions in both primary and secondary markets were executed during the trial.
The trial is part of a wider Banque de France initiative commissioned in March 2020, to test the integration of a central bank digital currency for the exchange and settlement of tokenised financial assets between financial intermediaries.
Isabelle Delorme, deputy CEO of ESES CSDs Euroclear, comments: “Together, we have been able to measure the degree to which the issuance of CBDC can offer fast and secure settlement of tokenised securities. We are well aware that there are still challenges that need to be overcome before we can envisage the implementation of blockchain platforms in production as we continue to investigate all routes to drive efficiencies for our clients.”