European Central Bank: Still Too Early for DLT in Eurozone

The ECB has once again shot down the idea that it might use distributed ledger tech as part of its market infrastructure in the near future.

Apr 11, 2017 at 9:02 p.m. UTC
Updated Sep 11, 2021 at 1:13 p.m. UTC

The European Union's central bank today once again shot down the idea that it might use distributed ledger tech as part of its market infrastructure in the near future.

Published alongside the latest annual report from the European Central Bank, released today, was a feature on the tech. While largely written in broad strokes, the paper reiterates a position expressed in the past by ECB officials – namely, that the central bank isn't likely to tap distributed ledgers in the near future.

The ECB wrote:

"The ECB is open to considering new ways to enhance its market infrastructure. However, any technology-based innovation would have to meet high requirements in terms of safety and efficiency … At this stage of its development, [distributed ledger technology (DLT)] is not mature enough and therefore cannot be used in the Eurosystem's market infrastructure. As DLT-based solutions are constantly evolving, the ECB will continue to monitor developments in this field and explore practical uses for DLT."

The language closely mirrors statements from ECB executive board member Yves Mersch, who in December remarked that "the ECB cannot, at this stage, consider basing our market infrastructure on a DLT solution", highlighting similar concerns focused on cybersecurity and operational efficiency.

Still, the ECB is pursuing a research effort alongside the Bank of Japan, which sees the two institutions weighing potential applications. And, in its feature, the ECB kept the door open to possible use in the future, though it offered nothing in the way of a possible timeline or indications as to what would drive it to utilize the tech.

"As DLT-based solutions are constantly evolving, the ECB will continue to monitor developments in this field and explore practical uses for DLT," the central bank said.

The ECB has been actively testing the tech since early last year.

ECB flag image via Shutterstock

The Festival for the Decentralized World
Thursday - Sunday, June 9-12, 2022
Austin, Texas
Save a Seat Now

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 a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
How the US Can Establish Itself as a Crypto Leader

Regulators have an opportunity to map out thoughtful, strategic policy on stablecoins and beyond.

Regulators have an opportunity to map out thoughtful, strategic policy on stablecoins and beyond.

CoinDesk - Unknown
2
CoinDesk - Unknown
No, the UK Is Not Going to Make USDC and USDT Legal Tender

For “legalize” read “regulate.”

For “legalize” read “regulate.”

CoinDesk - Unknown
3
CoinDesk - Unknown
Thoughts From Davos

The crypto industry showed up in force at the World Economic Forum’s annual meeting.

The crypto industry showed up in force at the World Economic Forum’s annual meeting.

CoinDesk - Unknown
4
CoinDesk - Unknown
Bitso, primer unicornio cripto de América Latina, despide a 80 empleados

El exchange, que tenía más de 700 empleados antes de los recortes, cuenta con cuatro millones de usuarios en la región.

El exchange, que tenía más de 700 empleados antes de los recortes, cuenta con cuatro millones de usuarios en la región.

CoinDesk - Unknown