BIS head describes ideal ‘unified ledger’ for central banks and other financial users

General manager of the Bank for International Settlements Agustín Carstens spoke astatine the Singapore FinTech Festival connected Feb. 22 and described the integer fiscal infrastructure helium believes would champion suit cardinal bankers’ needs. He called that infrastructure a “unified ledger.”

Carstens compared the theoretical unified ledger with a smartphone, saying they some enactment seamlessly with a assortment of components. Unlike a smartphone, a unified ledger would person unfastened architecture, however, and would amusement programmability and composability, that it, it would tally and bundle astute contracts. There are implicit 2 cardinal apps disposable to smartphone users, Carstens noted. He said:

“A unified ledger is simply a integer infrastructure with the imaginable to harvester the monetary strategy with different registries of existent and fiscal claims.”

A unified ledger would not person to beryllium decentralized oregon permissionless, Carstens said, but could accommodate a assortment of projects that “use of wealth arsenic a means of outgo and settlement” wherever the cardinal slope plays a ample relation successful the governance of the ledger and the consumer-facing assemblage is successful backstage hands.

What a large validation of our #CBDC design! Checkout the BIS insubstantial making the lawsuit for a #DLT based CBDC wherever Central Bank Money, #Tokenized Deposits and Other #stablecoins coexist connected communal ledger with #ecosystem and #regulatory frameworks #whysandbox https://t.co/yR1WCzzYU7

— EMTECH (@emtech_inc) February 22, 2023

Central slope integer currency and tokenized deposits could beryllium successful “partitioned” sections of the ledger, with astute contracts to facilitate their interaction, Carstens said. The ledger could beryllium utilized for everything from micropayments connected the Internet of Things to escrow successful existent property transactions.

Related: BIS to motorboat stablecoin monitoring task and up absorption connected CBDC experiments

Carstens took the accidental to explicit his existent reasoning connected stablecoin. He said of stablecoin proponents:

“But what this presumption forgets is that what sustains fiat wealth is not the exertion of caller technologies but each the organization arrangements and societal conventions down it.”

They besides tally the hazard of depegging, helium added. Stablecoins were developed due to the fact that they were technically capable to bash things different forms of wealth could not. Central banks should instrumentality those roles implicit from them.

Carstens besides raised the hackles of the crypto community Feb. 22 with a blunt appraisal of the occurrence of cryptocurrency.