The Banque de France, France’s central bank, has commissioned an experiment involving the settlement of treasury bonds in a blockchain-backed environment utilizing Central Bank Digital Currencies (CBDCs).
According to local media, the experiment is being conducted by a group of 500 financial institutions led by Euroclear, which includes Agence France Trésor, BNP Paribas CIB, Crédit Agricole CIB, HSBC, and Societe Generale.
The Treasury Bonds were tested on a blockchain environment created by IBM. Securities issuance, main and secondary market trades, liquidity optimization methods such as the repo, and interest payments are all part of the study. During the test, up to 500 instructions were recorded from both primary and secondary marketplaces.
France has been doing everything it can to design a feasible route for its adoption of CBDCs, and blockchain technology in general, as one of the frontline nations in the European Union and a G7 essential member. The CBDC-Treasury Bond settlement, which Euroclear backed, was part of the Central Bank’s attempt to investigate the integrative capacities of a future CBDC on the country’s main financial markets.
Many nations are also putting their proposed CBDC issue through its paces to ensure that the new form of money can readily integrate into the existing financial and economic landscape. For example, China has completed small-scale retail transactions with its proposed Digital Renminbi, making it one among the countries with advanced CBDC trials. Switzerland and Lithuania, for example, are two countries that have conducted CBDC studies.