New technology will allow investors to sell securities on a blockchain and receive income for them in their euro account
Germany’s Bundesbank has unveiled technology that allows investors to buy and sell financial instruments in euros on a blockchain, Reuters reports. To test it, a 10-year government bond was issued and sold by six banks: Barclays, Citibank, Commerzbank, DZ Bank, Goldman Sachs and Société Générale. The transactions to purchase the security were conducted using a “trigger chain” that linked the asset to the Target 2 payment system in a distributed ledger.
The regulator developed the technology jointly with the German exchange Deutsche Börse and the German government’s debt agency. The German central bank said the scope of the technology could be expanded to the entire eurozone even before the European Central Bank’s digital currency is launched.
“The participants in the deal showed the possibility of establishing a technological bridge between blockchain technology and conventional payment systems for the settlement of securities with central bank money without the need for a digital currency,” the regulator said in a statement.
U.S. Federal Reserve Chairman Jerome Powell said March 22 that the agency is studying the possibility of creating a fully digital dollar, but it will only be possible with the full support of Congress. According to him, the regulator has only begun to form the concept of a digital dollar and does not plan to undermine the private financial sector.
