SNB and new forms of money: why infrastructure comes first
The SNB discusses new forms of money mainly as a question of infrastructure: what does the financial centre need without undermining trust, data protection and stability?
Money is more than an app
When new forms of money are discussed, many people first think of a digital currency for everyday use. The Swiss National Bank's debate is narrower and at the same time more fundamental: what form of central bank money does the financial system need so that payments, securities settlement and monetary policy keep working reliably in a digital environment?
This is not about abolishing cash any time soon. Cash remains central bank money for the public. Depending on how it is designed, a digital form could have entirely different users: banks, financial market infrastructures or, at a later stage, private households.
Do not confuse wholesale and retail
The most important distinction is between wholesale and retail CBDC. Wholesale central bank money would be intended for financial institutions and could play a role in settling tokenised assets. A retail CBDC would be accessible to the general public. Both variants raise different questions.
The retail variant involves data protection, access for everyone, the role of banks and the risk that in a crisis deposits are shifted from banks to the central bank within a short time. Wholesale solutions, by contrast, mainly concern the security and efficiency of financial market processes. They are less visible, but they can matter more for stability.
The SNB tests before it decides
With Project Helvetia and further trials, the SNB has gathered experience with digital central bank money for regulated financial institutions. A pilot, however, is not a political commitment to a permanent product. This caution is sensible precisely with monetary infrastructure: technical feasibility does not yet answer the questions about the legal basis, governance, cyber resilience and the consequences for banks and customers.
Stablecoins change the starting position
Alongside central bank money, privately issued digital means of payment are emerging, above all stablecoins. Their stability does not depend on the name, but on reserves, legal claims and supervision. For Switzerland as a financial centre, what matters is that payment promises remain redeemable even under stress and that money laundering risks are kept under control.
The simple narrative «digital equals more efficient» is therefore not enough. A faster payment system can create new concentration risks; a programmable system can be useful, but it can sharpen data protection questions.
What stays the same for users
For the general public, what matters is that a discussion about digital central bank money is not an announcement of new obligations or of an imminent switch. Account balances held at banks remain private bank money; cash remains a legally anchored means of payment. Any new infrastructure would first have to prove its added value against existing, secure and widely used payment options.
The same holds for the financial centre: interoperability and robust settlement matter more than a technically spectacular single solution. A new form of money would only be progress if it did not shift outages, fraud and settlement risks, but demonstrably mastered them.
The open strategic question
The SNB does not shape the future of money on its own. Legislators, banks, fintechs and international standard setters help shape the rules. Its task is to examine where central bank money improves a public infrastructure service – and where private innovation under clear supervision is enough.
Success will not be measured by whether Switzerland launches a digital currency as quickly as possible. What matters is whether trust, liquidity and access remain reliable in a tokenised financial world as well.
