French Central Bank Trials Digital Currency for Interbank Settlement

Banque de France has successfully conducted a central bank digital currency (CBDC) experiment using a blockchain platform for interbank settlement.

• According to a Banque de France statement, the pilot involved the settlement on a private blockchain, provided by U.K. blockchain startup SETL, of around €2 million (US$2.43 million).
• The French bank used SETL’s fund management platform Iznes, along with Citi, CACEIS, Groupama AM, OFI AM, and DXC, as part of the process for the first settlement of funds using CBDC.
• More experiments of the pilot program are underway through mid-year and the process will be an important contribution to research around the interest of a CBDC, said the bank.
• Francois Villeroy de Galhau, governor of the Banque de France, has spoken openly of the potential benefits in the development and issuance of the CBDC.
• In 2020, the French bank published a request for proposals for CBDC “experiment” applications. The project’s aim was to help France’s central bank understand the risks and mechanisms of CBDCs and also contribute to the eurozone’s digital cash conversation.

Read more: French Central Bank Puts Out Call for Digital Currency Experiments