ECB, Bank of Japan Launch Joint Distributed Ledger Research Effort

The European Central Bank is weighing the use of distributed ledger tech in partnership with Japan’s central bank.

AccessTimeIconDec 6, 2016 at 10:47 p.m. UTC
Updated Sep 11, 2021 at 12:44 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

The European Central Bank is weighing the use of distributed ledger tech in partnership with Japan’s central bank, one of its senior officials said today.

Speaking today at the Handelsblatt Annual Conference Banken-Technologie in Frankfut, ECB executive board member Yves Mersch offered new details on its work in the area.

Mersch said that the the two institutions plan to explore the tech over the next months, with an eye to publish the results of its research sometime next year. The ECB has also formed an internal task force focused on distributed ledgers, building on past research efforts.

He told attendees:

“Together with the Bank of Japan, we agreed to launch a joint research project which studies the possible use of [distributed ledger technology] for market infrastructure. The project is expected to release its main findings next year. This work can help define how new technologies can change the global financial ecosystem of today and ensure that central banks are adequately prepared.”

However, Mersch remarked that the tech “is not ready for mass adoption”, adding that at present that the ECB’s technical and security requirements would prohibit integration today. Further, any system that might be developed either solely by the ECB or in partnership with other central banks would be subject to intense scrutiny prior to launch, Mersch said.

“It cannot be stressed enough that any technology-based market infrastructure service needs to be mature enough to meet high requirements in terms of safety and efficiency,” he noted.

The statements perhaps represent the ECB’s most forceful on the subject to date. A number of central banks worldwide, most notably the Bank of England, have invested time and resources in investigating the potential to replace some of its infrastructure with the tech, or utilize it to issue central bank-tied digital currencies.

According to Mersch, the ECB wants to be a stakeholder in that global effort.

“We are on a journey which could radically alter the financial ecosystem as we know it. The ECB is committed to be part of this journey,” he concluded.

Image Credit: ilolab / Shutterstock.com

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.