Bundesbank President: Blockchain is a ‘Multi-Purpose Tool’

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The head of Germany’s central bank described blockchain as “a multi-purpose tool” during a G20 summit speech earlier this week.

Leaders from the international organization are meeting in Germany this week to discuss issues around the digitization of finance. The event also saw Bank of England chief Mark Carney remark on distributed ledger tech, suggesting that the tech could “reshape” the financial sector.

While Bundesbank president Jens Weidmann largely steered clear of such statements, he did briefly note the central bank’s work with exchange operator Deutsche Börse on a blockchain-focused securities trade project, as well as internal research on the tech.

He told conference attendees:

“Originally developed for the bitcoin virtual currency, this distributed ledger technology, it would appear, has turned out to be a multi-purpose tool. And even central banks – which aren’t typically known for being early adopters of new technologies – are currently doing experimental research on the potential use of blockchain.”

Perhaps most notably, Weidmann went on to indicate support for an accommodative regulatory framework for FinTech startups as part of Germany’s presidency of the G20 group. In his speech, he said that an approach that avoids “hindering financial innovation is warranted”.

While he didn’t offer any details as to what that framework might constitute, Weidmann indicated that any initial steps would include mapping out possible strategies for developing any FinTech-facing rules.

“Our aim is to develop a set of common criteria for the regulatory treatment of FinTechs,” he said.

Image via Wikimedia

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