By
Godfrey Benjamin
April 26th, 2024
In the latest announcement on France and Luxembourg collaborating on the Venus project, it was revealed that both institutions are proposing cross-border settlements.
The Central Bank of France and the central bank of Luxembourg have partnered to roll out the “Venus Initiative”, which allows them to use an experiential CBDC for a 100 million euros bond. Worth $104 million, the bond is the latest means employed in a series of trials in tokenized financial markets. Apart from France and Luxembourg central banks, the Venus Initiative involved Goldman Sachs (NYSE: GS), Santander, Societe Generale, and European Investment Bank (EIB). The EIB appointed Goldman Sachs Bank Europe SE, Santander, and Societe Generale to be in charge of issuing and distributing the digital native bonds.
France and Luxembourg Central Banks on Venus Initiative
The General Director of Financial Stability and Operations at Banque de France, Nathalie Aufauvre, had something to say about the project. He said the Venus Initiative had brought both the France and Luxembourg central banks together. He explained further:
“It shows how digital assets can be issued, distributed and settled within the Eurozone, in a single day. The Venus initiate confirms that a well-designed CBDC can play a critical role in the development of a safe tokenized financial; asset space in Europe. It also aims to contribute to the Eurosystem’s reflections on how to improve our services to the wholesale market in particular under the upcoming DLP Pilot Regime regulation adopted by the European Union.”
Meanwhile, the French central bank has been conducting a series of CBDC tests to manage liquidity in decentralized finance. The bank is also working on using central bank digital currency in settling cross-border transactions. In September, the financial institutions unveiled new projects targeted at achieving the benefits of CBDCs use at the wholesale level. A governor at the bank, Villeroy de Galhau, said a wholesale CBDC would help in both cross-border and cross-currency payments. He also revealed that the European Central Bank is considering issuing a digital euro as soon as 2026.
More on Venus Project
In the latest announcement on France and Luxembourg collaborating on the Venus project, it was revealed that both institutions are proposing cross-border settlements. Gaston Reinesch noted:
“With the EIB innovative issuance under the Luxembourg law, the Banque de France and the Banque centrale du Luxembourg are proposing one possible cross-border answer to the growing interest from the market to perform digital native securities settlements with a Central Bank Money token.”
In the US, the federal reserve bank of New York announced plans to launch a 12-weeks proof-of-concept pilot/ The program was designed to involve major commercial banks like BNY Mellon (NYSE: BK), Citi (NYSE: C), and more. The aim is to conduct advanced research on “asset tokenization and the future of financial market infrastructures in the US as money and banking evolve.