The SNB is working with SIX on the research, embarking on a proof of concept to explore how digital central bank money could be used in the settlement of tokenized assets between market participants.

The project is making use of the SIX Digital Exchange (SDX) platform, which is currently being built and promises to be the world's first end-to-end exchange for digital assets when it launches next year offering listing, trading, settlement and custody service.

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The SDX system will be used to explore technical possibilities for integrating digital central bank money into DLT platforms. Options include the connection of the existing Swiss Interbank Clearing System or the issue of digital Swiss franc tokens by the SNB for financial market participants.

Jos Dijsselhof, CEO, SIX, says: "We are pleased to contribute to this initiative and, through SIX Digital Exchange, to explore the technological possibilities with which the SNB could support token-based financial ecosystems in the future by providing digital central bank money for financial market participants."

The new innovation hub will also work on a second research project, looking into the rise in requirements placed on central banks to be able to effectively track and monitor fast-paced, automated electronic markets.