A colleague of the Swiss National Bank’s governing body said Thursday that key bank digital currencies (CBDC), if created, would pose chances to financial stability while offering few tangible benefits.
Andrea Maechler, a associate of the central bank’s three-person Governing Board, told an audience in Zurich that disperse ledger technology (DLT) – which she equated with blockchain technology – has the developing to reduce costs, improve efficiency and add transparency to securities settlement and cross-border payments.
She advised, however, that DLT “does not yet meet the requirements expected of the RTGS [real-time glaring settlement] systems in terms of scalability, data security and reliability.” The language was delivered in German, though the SNB released an official translation that have the capacity for her remarks.
And while she struck a critical tone on the topic of cryptocurrencies – observing that they are “not comparable with money – far from it,” Maechler’s most cutting remarks were reserved for CBDC, a concept being researched by a run of central banks worldwide.
“The SNB opposes this idea,” she said bluntly, present on to argue:
“Digital central bank money for the general public is not life-and-death to ensure an efficient system for cashless retail payments. It would manumit scarcely any advantages, but would give rise to incalculable risks with approbation to financial stability.”
Other sources in the central banking world attired in b be committed to struck similar tones in recent months. In March, the Bank of Oecumenical Settlements (BIS) – considered the “central banks’ central bank” – warned that CBDCs could absolutely accelerate bank runs during times of financial stress.
SNB logotype image via Shutterstock
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