The European Central Bank (ECB) has revealed it is exploring a blockchain-based system to help process central bank money transactions. This is significant, considering how this could further promote blockchain and crypto adoption worldwide.
ECB Exploring Blockchain-Based System For CBDC Transactions
In a press release, the ECB revealed that the Governing Council has decided to expand its initiative to settle transactions recorded on distributed ledger technology (DLT) in central bank money. The Central Bank will adopt a “two-track approach” for this initiative.
First, the European Central Bank will develop and implement a safe and efficient platform for such settlements in central bank money through an interoperability link with TARGET Services. The Bank said it would announce a concrete time plan in due course.
Meanwhile, for the second approach, the Eurosystem will look into a more integrated, long-term solution for settling DLT-based transactions in central bank money. The ECB revealed that this would also include international operations, such as foreign exchange settlements.
The press release also noted that the Eurosystem wants to support the use of innovative solutions like Blockchain technology in its market infrastructures while maintaining the safety and efficiency of TARGET Services. The Central Bank stated that the Eurosystem will continue to analyze new technologies further and engage actively with public and private stakeholders.
Commenting on this development, ECB Executive Board member Piero Cipollone said,
“We are embracing innovation without compromising on safety and stability. This is an important contribution to enhancing European financial market efficiency through innovation. Our approach will pay due attention to the Eurosystem’s goal of achieving a more harmonised and integrated European financial ecosystem.”
According to the Central Bank, this initiative will contribute to establishing an integrated European market for digital assets, in line with the Governing Council’s call for promoting a digital capital markets union.
Boluwatife Adeyemi
Boluwatife Adeyemi is a well-experienced crypto news writer and editor who has covered topics that cut across DeFi, NFTs, smart contracts, and blockchain interoperability, among others. Boluwatife has a knack for simplifying the most technical concepts and making it easy for crypto newbies to understand. Away from writing, He is an avid basketball lover and a part-time degen.
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