The First Deputy Governor of the central bank of France, Denis Beau, spoke in support of a blockchain-based settlement system that would allow for faster transfers of euros, as well as be more cost-efficient, according to a report by Yahoo! Finance.
Beau wants to use distributed ledger technology (DLT), and France is considering a central bank digital currency (CBDC). He said that “disorderly approaches and heterogeneous adaptations” could happen if the bank didn’t take decisive action.
DLT would also help in terms of cross-border payments, he said. Many EU residents have to wait a long time for payments to work their way through the region’s banking systems, and that the “correspondent banking model” is outdated and too pricey.
Digital tokens could also help, he said, adding that if you combine tokens with DLT, you could easily move money, as well as “help in answering market’s demands.”
The country’s central bank has supported the idea of DLT, and it hired a blockchain analyst to help with the implementation of a digital currency program.
“As a major provider of critical wholesale clearing and settlement services in euro, [the Eurozone] should be open to experimenting these innovations in order to revisit and possibly improve the conditions under which we make available central bank money as a settlement asset,” Beau said. “We, at the Banque de France, are therefore quite open for experiments in that direction, together with the European Central Bank (ECB) and other central banks of the Eurosystem, in particular with regard to a wholesale CBDC.”
The ECB has been open to the idea, and could already be experimenting. It started a FinTech-targeted Innovation Hub this month, saying that the hub should “foster international collaboration among central banks on innovative financial technology.”
The president of the European Union is less on board, saying coins should be regulated, but that he didn’t want to make them.