October 25, 2020

The head of the Central Bank of Chile: National digital currencies do not need blockchain

The head of the Central Bank of Chile: National digital currencies do not need blockchain

Mario Marcel, head of the Central Bank of Chile, said that although digital currencies are central banks (CBDC) have advantages over paper money, they do not have to work on the blockchain.

Marcel made comments on the globalThe OECD Blockchain Policy Forum, which took place last week. He added that the CBDC concept is not innovative and has existed since the advent of the first real-time gross settlement systems.

The head of the Central Bank explained that blockchain technology is more useful when only a few participants have access to the information registry and / or they do not necessarily trust each other.

However, when the central bank issues itscurrency in physical or digital format, "trust should be taken for granted." In addition, not all market participants should have access to confidential information conducted using CBDC.

Marcel cited digital currency as an example.Uruguay (e-Peso), released as part of the pilot program and not based on the blockchain. The governor also seems uninterested in the idea of ​​a CBDC, stating that countries, especially developing countries, should evaluate other alternatives, such as quick payment solutions.

At the same time, the Central Bank of Chile is studyingblockchain in other directions, such as bonds. Marcel said the central bank worked with the local central securities depository to explore the possibility of issuing blockchain-based bonds. It is expected that the first information will be released in November this year.