The Swiss SME Scenic Swisscoast GmbH launches the Swiss Franc as a new cryptocurrency. Unlike other cryptocurrencies such as Bitcoin, the Digital Swiss Franc can be used at any time at the nominal value of the official Swiss currency (CHF). The project is reminiscent of the token Tether, which is designed as an equivalent figure to the US dollar.
At the beginning of February, Bern’s SME Scenic Swisscoast GmbH set up a new, stable cryptocurrency called the Digital Swiss Franc, which is not subject to fluctuations in the Swiss franc against the Swiss National Bank. The Digital Swiss Franc is sold online and can be purchased from Scenic Swisscoast GmbH. There are currently two possible uses for this “digital twin” to the Swiss franc. On the one hand, it will be accepted as a currency at the International Innovation Film Festival IFF, which will take place from 14 to 18 February 2018 in Bern. On the other hand, the Swiss Franc is also accepted by the Scenic Swisscoast GmbH as a means of payment for its own services.
Why a Digital Swiss Franc?
With the introduction of the digital Swiss franc, different goals are pursued. In addition to a new form of customer loyalty, the SME in Bern is thus consolidating its already established position in the field of international and national innovation technologies. At the same time, another project will be realized in which Scenic Swisscoast GmbH will demonstrate its expertise on the basis of concrete implementation and pave the way for other blockchains or cryptocurrencies.
Since the Digital Swiss Franc respects the regulatory requirements in a first phase with a clearly predefined money supply and trading conditions, no approval is required for this undertaking. For the transfer of the digital Swiss franc, existing channels and apps can be used: the transfer is possible from smartphone to smartphone. Compared to proprietary payment systems such as Twint, the Swiss Franc also has an important advantage: It complies with the Ethereum standard and is therefore compatible with many existing Blockchain DApps.
In an introductory phase until 1 March 2018, the Digital Swiss Franc will be upgraded on subscription. While the Swiss franc exchange rate remains at least 1: 1, up to 15% more Swiss francs are transferred than were purchased. If the Swiss franc is currently exposed to negative interest rates by the SNB, on the other hand, the “digital twin” will receive guaranteed added value. The Digital Swiss Franc has proven itself twice in this context.
A Swiss tether?
Overall, the whole concept of a cryptocurrency tied to the Swiss franc exchange rate is strongly reminiscent of the token tether, which is in a similar ratio to the US dollar. Tether is a popular means of avoiding the direct exchange of crypto in Fiat due to the fixed price of the US dollar at several Exchanges. Thus, profits can be realized through the tokens, so to speak, without realizing them effectively. Recently, however, Tether had also come under heavy criticism, as the actual coverage of tethers was doubted by US dollars. To what extent the Swiss Franc will find a similar application in practice as its American counterpart, remains to be seen.
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