The Central Bank shares lessons learned from its wholesale CBDC experiments using distributed ledger technologies
The Central Bank of France has revealed the benefits a tokenised form of currency can bring, from its tests on a wholesale CBDC (wCBDC).
Through testing, the Central Bank has shown that a tokenised form of central bank money could improve cross-border payments, settlement finality and security for a range of financial assets, from government bonds to fund shares.
The report highlighted eight key takeaways.
Four key policy takeaways include issuing a wCBDC as a compliment to a retail CBDC, prioritising international cooperation and public-private partnerships to increase global inclusivity, a focus on interoperability, and the need for a climate-friendly design.
Key technical takeaways include technological advancements for central banks to maintain control over their wCBDC, a requirement for central banks to remain technologically neutral, using distributed ledger technology (DLT) to enhance trade activities and contribute to overall financial stability, and lastly, the need to continue experiments to develop an operational framework.
The programme was launched in 2020 and compromised of 12 experiments. Through these experiments, the Central Bank showed the operational feasibility and practical implementation of three models it conceptualised for issuing wCBDC—the interoperability, the distribution and the integration model.
These findings contribute to the European Central Bank’s plans to investigate how wholesale financial transactions recorded on DLT platforms could be settled in central bank money.
Emmanuelle Assouan, director general of financial stability and operations at the Central Bank, commented: “These 12 experiments have provided us with the assurance that central bank money can be provided in a tokenised form to settle tokenised assets and improve cross-border payments.
“We have demonstrated that our DLT solution is flexible and can be interoperated with other DLT solutions.”
Assouan believes multiple wCBDC DLTs can exist on a global scale. Assouan added: “It is therefore key to explore their interoperability from the outset of their design.”