HSBC Collaborates With IBM For CDBC

HSBC and IBM have successfully tested an advanced token and digital wallet settlement capability encompassing direct transactions between two central bank digital currencies (CBDC) in a hybrid cloud environment.

The experiment successfully tested an end-to-end transactional lifecycle covering CBDCs, eBonds, and foreign exchange. It was conducted in a hybrid cloud environment incorporating public and private clouds and on-premises data sources.

Distributed ledgers based on IBM’s Hyperledger Fabric and R3’s Corda were integrated using IBM Research’s Weaver interoperability tool. The project was initiated by Banque de France which has emerged as a leader among central banks in its breadth of CDBC experimentation as part of a multi-pronged program to explore the potential of the digital Euro.

HSBC, one of the world’s largest foreign exchange banks, and IBM, a leading provider of consulting services and technology to the financial services industry, were chosen from a diverse field of highly-regarded financial and technology applicants.

Our collaboration with IBM on this initiative has resulted in this milestone of streamlining front-to-back securities and foreign exchange DVP and PVP settlement processes. Interoperability across different DLTs and technologies was key in demonstrating reduce market risk and improve security for transactions between central banks, commercial banks and, in time, our clients around the world.