While we warn against the risks of cryptos, such as bitcoin and ether, we recognise the opportunities of blockchain technology for payments.
We urge businesses and consumers to be aware of the risks associated with investing in cryptos, as these are not backed by central banks or other supervisory authorities. They are not covered by a guarantee system either.
It is not our task to impose a ban or lay down regulations. The ECB will not impose any bans either, said its President Mario Draghi during one of the ECB's Youth Dialogues. He did issue a warning, however: "The euro is backed by the ECB and the dollar is backed by the Federal Reserve. Nobody backs the bitcoin".
We recognise the opportunities for blockchain or distributed ledger technology (DLT) in the payment system, and that's why we want to learn more about this technology. We have built a test network to gain more practical knowledge and consult with market operators about the possible applications of blockchain. At present, we believe the technology is not yet mature enough for it to be applied in the payment system. It is too slow and not sustainable enough.
The ECB shares this conclusion: "At this stage of its development, DLT is not mature enough and therefore cannot be used in the Eurosystem’s market infrastructure. As DLT-based solutions are constantly evolving, the ECB will continue to monitor developments in this field and explore practical uses for DLT."
How can we harness blockchain technology to support the economy?
Want to read more?
Read more about our vision on cryptos and blockchain here.