It may not be the time yet to have an electronic Swiss Franc for the population. The Swiss government considers that there are more risks than benefits in this digital currency that could eventually destabilize the financial system. This is despite the friendly position that the country has towards cryptocurrencies and blockchain technology.
No Electronic Swiss Franc For General Use
In a recent report released by The Federal Council, they analyzed the different opportunities and risks related to the creation of a digital Franc. At the moment, the risks outweigh the benefits of such a currency considering they could have a negative effect on financial stability.
The analysis was based on the creation of a digital currency that would be available to the general public and that it would be complementary to other existing forms of central bank money.
As the report explains, there are other countries that are exploring the possibility to issue a digital currency based on their local fiat currency. These countries include Sweden and China, however, there are no clear roadmaps about which could be the next steps before being able to use a Central Bank Digital Currency (CBDC).
Some of the benefits of CBDCs include better access to payment and financial services for users and easy access to money that is free of default risk. Moreover, it could be possible for monetary policies to become more efficient over time while reducing tax evasion and money laundering.
However, the government considers that digital currency for financial market players could be a much more promising strategy.
It is also worth mentioning that Christine Lagarde, the president of the European Central Bank (ECB) said that they should be ahead of the curve in terms of stablecoins and digital currencies because there is a demand that the ECB has to address.