‘Switzerland needs national cryptocurrency’: think tank
One of Switzerland’s most prominent business think tanks is calling on the central bank to start issuing its own cryptocurrency. Avenir Suisse believes this is an essential step along the path to creating a new blockchain economic model.
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In a report entitled “Blockchain After The HypeExternal link”, Avenir Suisse argues that it is time for the talking to stop and for the SNB to take the plunge into a centrally issued digital currency. The reasoning is that the Swiss financial sector, including the country’s stock exchange, has for some months been forging ahead with plans to create DLT platforms to enable the trade of tokenised assets.
“If it manages to position itself internationally as a pioneer in trading tokenised securities, Switzerland will be able to expand its relatively small capital market,” states Avenir SuisseExternal link. “It would facilitate tokenised securities trading if the National Bank and major players in the industry were to drive the development of a Swiss franc token.”
“Stablecoin”
But unlike decentralised cryptocurrencies such as bitcoin, this proposed model would give the SNB control over the digital token. It should also be pegged in value to existing currencies – a so-called “stablecoin” – argues the think tank.
DLT acts like a digital accountancy software that automatically keeps track of transactions and who owns assets contained within its system. This would allow token holders to trade directly with each other without the need for banks, accountants and other intermediaries to balance the books. The big selling point is that it would save time and cost by stripping out third parties in transactions.
Avenir Suisse is enthusiastic about the potential of DLT, particularly for securities trading, wealth management and trade finance. But the body appears less keen on bitcoin.
“Switzerland now has to take the next step in the development of DLT, morphing from the much-vaunted ‘Crypto Valley’ into a fully-fledged DLT nation,” it stated.
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