Spain’s central bank launches third wholesale CBDC trial

The Spanish central bank has launched a third trial for its wholesale central bank digital currency (CBDC), focusing on a natively digital bond.

Banco de España is partnering with Minsait, an IT and consulting firm owned by Indra Sistemas, one of Spain’s largest tech firms. The trial will explore how a wholesale CBDC can introduce efficiency and save costs in the bond market. The two will use a CBDC to settle the issuance of a natively digital bond and other secondary transactions. They will also explore the use of digital currency in other related events, such as bond redemption and coupon payments.

According to the top bank, the CBDC and the digital bond will be issued on the same infrastructure, although it didn’t reveal the extent to which blockchain will play a part. This enables the participants to experiment with delivery versus payment.

Unlike in previous trials, Banco de España will also launch a simulated central securities depository (CSD) and invite industry players to participate.

This isn’t Minsait’s first CBDC project. In 2021, it partnered with eCurrency, a CBDC research and development firm, to offer various tools and services to central banks exploring digital currencies.

Banco de España has ramped up its CBDC efforts in recent months. In January, it selected three tech firms as partners for its wholesale CBDC trials. One of its trials included developing a tokenized deposit solution for interbank payments with Adhara Blockchain.

The second trial, with Cecabank and Abanca, involved tokenized securities and was similar in scope to its latest partnership with Minsait.

The central bank’s trials are separate from the regional efforts with the digital euro. Spain is one of several European countries working on local digital currency solutions as they await the ECB’s direction on the regional solution. Central banks in France, Germany, Switzerland, Italy, and other leading economies have all launched their own trials.