July 20, 2024

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 central digital currenciesBank DCs (CBDCs) have advantages over paper money and do not need to operate on the blockchain.

Marcel made comments at the globalOECD Blockchain Policy Forum, which took place last week. He added that the CBDC concept is not innovative and has been around since 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 a ledger of information and/or do not necessarily trust each other.

However, when the central bank issues itscurrency in physical or digital format, “trust must be a given.” In addition, not all market participants should have access to confidential information conducted using CBDC.

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

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