Pioneering Swiss crypto bank Sygnum unveiled a stablecoin attached to the Swiss franc. The “settlement token” for Sygnum’s “DCHF” is backed 1:1 by funds held with the Swiss National Bank.
DCHF is being considered for support from SIX Group’s upcoming SDX digital asset trading platform, in which Sygnum is a member, local media outlet Swissinfo reported.
The purpose of the crypto bank is to target institutional clients with its stablecoin, emphasizing that the coin allows fast and frictionless settlement alongside new financial applications.
Besides settlements, Markus Hartmann, Head of Tokenization at Sygnum, claims that the DCHF token can be used to execute smart contract payment structures, including “dividend pay-outs and other corporate actions.”
Sygnum co-founder Mathias Imbach describes “trustworthy stablecoins” as being “of central importance for the development of the digital asset economy,” adding that the DCHF “creates considerable operational efficiencies and at the same time promotes the development of new business models.”
Sygnum First Crypto Licensed Bank to Issue CHF-Backed Stablecoins
Since Sygnum holds a digital asset banking license with the Swiss Financial Market Supervisory Authority (FINMA) since August 2019, the firm claims to be Switzerland’s first licensed bank to issue a stablecoin.
The crypto bank accepts deposits in fiat currencies including CHF, euros, Singaporean dollars and US dollars. all of which can be converted to DCHF through an internet banking portal.
The company also holds a license to provide capital markets services in Singapore.
Although the company claims the title of the first regulated bank to issue a Swiss stablecoin, it is not the first company to launch a CHF-pegged crypto asset.
In 2018, Bitcoin Suisse AG founded the company Swiss Crypto Tokens to issue the first stablecoins backed by CHF. The Swiss Crypto Tokens include ERC-20 tokens that are redeemable in batches of $1,000 for fiat currency and are audited monthly.