|
|
Benoit Coeure said the underlying distributed ledger technology could pose new risks to the financial system, including legal and operational obstacles.
Coeure said: “Distributed technology could become a game-changer for payment, clearing and settlement activities if fintech companies and financial institutions can leverage the technology to meet demanding legal, operational and risk management requirements.”
The Bank for International Settlements (BIS) said designers of blockchain technology for financial services will have to satisfy regulators they can meet stringent risk requirements if it is to fulfil promises of revolutionising banking and other parts of the economy.
The ECB will be one of the key regulators for the proponents of blockchain technology, along with other central banks such as the Bank of England and the US Federal Reserve.
The report from the BIS, often known as the central banks’ central bank, points to the uncertainty of how the distributed ledger would work in practice, as well as legal concerns in what believers say will be a central part of the global financial system.
The blockchain is “an evolving technology that has not yet been proven sufficiently robust for wide-scale implementation,” the report says.
Bank bosses are investing heavily in the technology, with one Barclays executive saying it would become the “operating system for the planet”. Fintech start-ups as well as established players are rushing to try to dominate what could become a central part of everyday life.