French central bank successfully completes first test of their sovereign digital currency
National fiat currencies will all one day be digital, and the move's already starting ...
Key takeaways
- In the experiment, the central bank simulated cash transactions worth over €2 million using the digital currency.
- Other participants of the experiment include Citi and CACEIS, which additionally acted as the custodian of the funds; both purchased the CBDC from the central bank.
- Moreover, it tested the digital euro under real world circumstances with Société Générale.
Cite or link to this article
Griffin, M. (2021) 'French central bank successfully completes first test of their sovereign digital currency', 311 Institute, 6 June. Available at: https://www.311institute.com/french-central-bank-successfully-completes-first-test-of-their-sovereign-digital-currency/ (Accessed: 1 October 2026).
France’s central bank has announced it successfully completed a pilot transaction with a Central Bank Digital Currency (CBDC) last month that has captured the full settlement cycle, and for those of you wondering what a CBDC is it’s a digital version of your country’s cash, and increasingly it looks like the future of sovereign currencies as countries everywhere, from China, Europe and Sweden, and the UK and US, start running trials and finding ways to avoid freaking out their own financial services industries like those on Wall Street which CBDC’s could disintermediate overnight.
Banque de France (BDF) collaborated with London based SETL, a settlement and payments infrastructure provider, to receive the necessary Distributed Ledger Technology (DLT) and the infrastructure for the issuance and redemption of the sovereign digital currency. SETL’s IZNES team was responsible for facilitating the transaction.
“The successful completion of a CBDC live experiment with BDF confirms that SETL is uniquely positioned to help transform financial markets,” SETL Chairman, Sir David Walker, said in a statement.
In the experiment, the central bank simulated cash transactions worth over €2 million using the digital currency. Shares of the money market fund ‘Groupama Enterprises’ were subscribed and redeemed.
Other participants of the experiment include Citi and CACEIS, which additionally acted as the custodian of the funds; both purchased the CBDC from the central bank.
Several central banks in Europe are now in the race to develop a digital currency, and the French regulator is at the forefront.
The complete CBDC pilot happened after the French central bank named eight private partners for interbank settlements. Moreover, it tested the digital euro under real world circumstances with Société Générale.
“Further to the successful delivery of our two market infrastructures, the Fund Platform IZNES and the ID2S Central Securities Depository, we are now excited to take our Payments offering to the next level. Together with our proven track record in delivering regulated Market Infrastructures, this further strengthens SETL’s strategic capabilities,” SETL CEO, Philippe Morel said.
Meanwhile, the European Central Bank is evaluating the importance of the digital euro, and its President, Christine Lagarde earlier said that the regulator might launch a digital currency in the next two to four years.
What this means for your organisation
A full settlement cycle was captured.
The test covered issuance and redemption, not just a transfer, with fund shares subscribed and redeemed. Capturing the whole cycle is what makes a pilot meaningful. Operations teams should judge trials by how much of the end to end process they cover.
Incumbents are being brought inside.
Eight private partners were named for interbank settlement, and the trial ran with large banks and a custodian rather than around them. The aim is to avoid unsettling the existing industry. Banks should seek a place in these pilots while the design is open.
The timetable is now years, not decades.
Several European central banks are racing to develop a digital currency, and the European Central Bank has signalled a launch within a few years. That is inside most planning horizons. Treasurers should put sovereign digital currency on the current roadmap.
Three questions for your next leadership meeting
- Do our pilots cover the whole process or only one step?
- Are we inside the central bank trials in our markets?
- Is sovereign digital currency on our current roadmap?
The trends and technologies behind this story
From the 311 Starburst, the 311 Strategic Intelligence Unit’s map of the technologies and trends shaping the next 50 years.
Analysis by the 311 Strategic Intelligence Unit, from Matthew Griffin’s article and 311 data. First published on Fanatical Futurist.
FAQ
Why does this matter?
National fiat currencies will all one day be digital, and the move's already starting ...
About the author
Matthew Griffin Founder, President and Futurist, 311 Institute
Matthew Griffin is a multi-award winning Futurist and expert in Disruption and Innovation, Geopolitics, Leadership, and Technology, who NASA have described as a "walking encyclopaedia of the future" and a "futurist Polymath."
Read full bio
Matthew Griffin is a multi-award winning Futurist and expert in Disruption and Innovation, Geopolitics, Leadership, and Technology, who NASA have described as a "walking encyclopaedia of the future" and a "futurist Polymath." 17-time best selling author of the "Codex of the Future" series, Matthew is the Founder, President and Futurist of the 311 Institute, a global Futures and Deep Futures advisory firm working with royal households, world leaders, G7, G20, and G77 governments, NGOs, and multi-national mid and mega cap firms to help them explore, shape, and lead the next 50 years of business and society.
An award-winning YouTube creator with over a million followers, with an unrivalled global reach and impact, Matthew is a highly sought-after international keynote speaker, lecturer, and mentor who collaborates with global leaders through the United Nations Alliance of Civilizations (UNAOC) and United Nations General Assembly (UNGA) to shape pivotal initiatives such as the UN’s AI for Humanity programme, the United Nations Conference of the Parties (UN COP), and the World Economic Forum in Davos.
As the former Global Head of Cloud, National Security, and Enterprise Sales for companies including Atos, Dell-EMC, and IBM, Matthew has a proven track record of building multi-billion dollar business units and turning failing divisions into market leaders. His ability to identify, analyse, and communicate the implications of hundreds of emerging technologies and trends is unparalleled, and his insights are trusted by many of the world’s most respected organisations, including ABB, Accenture, Adidas, AON, ARM, BCG, Centrica, Citi, Coca-Cola, Dentons, Deloitte, Dow Jones, EY, Google, KPMG, Lego, Legal & General, LinkedIn, Microsoft, PepsiCo, Qualcomm, RWE, Samsung, Siemens AG and Siemens Energy, T-Mobile, UBS, VISA, Walmart, Workday, Worldpay and many others.
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Sources and further reading
- Digital dollar could compete with bitcoin forbes.com
- China digital currency beijing suzhou confirm latest trials e scmp.com
- Banque de France banque-france.fr
- SETL setl.io
- Citi report cbdcs will be part of digital money 2 0 pymnts.com
- Caceis involved with french central banks trials of digital currency for fund unit settlement caceis.com
- eight private partners financemagnates.com
Source: first published by the 311 Institute on 6 June 2021. Cite as: Griffin, M. (2021). French central bank successfully completes first test of their sovereign digital currency. 311 Institute. https://www.311institute.com/french-central-bank-successfully-completes-first-test-of-their-sovereign-digital-currency/
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