Deutsche Bundesbank, the German central bank seems to be clear on its stance regarding the development of a CBDC. In its latest announcement, the bank revealed that it was instead focusing on the incorporation of blockchain technology.
China’s plunge into the development of central bank digital currencies (CBDC) has inspired several countries to get into this race. While an array of governments have been fearing china’s dominance over the financial sphere with it’s CBDC launch, Germany seems to be untethered. The country has time and again revealed that it doesn’t intend on rolling out a CBDC. Its latest move further reveals that the country aspires to function without a CBDC.
German Bank To Lay Its Focus On The Development Of Blockchain Tech
The German central bank seemed to be relaxing while all the governments are trying get ahead in the CBDC game. In a recent post, the bank pointed out that it was successful in testing a settlement interface for securities. However, this is via the distributed ledger technology [DLT]. With this, the country intends to bring blockchain tech into the conventional payment systems.
The Executive Board member of Deutsche Börse, Stephan Leithner, spoke about this innovation and said,
“New technologies are a key component in creating infrastructures of tomorrow that meet the markets’ needs. This project marks a major step towards more efficient securities settlement and securities digitalisation by combining new technologies with existing infrastructures in a smart way.”
While this would facilitate payments through blockchain tech, the post eliminated the need for the creation and development of a CBDC. This statement was a clear indication that the German bank wanted to go about without a central bank issued currency.
The post further elaborated on the project as it read,
“This test sees Bundesbank and Deutsche Börse now joining forces with the Finance Agency to continue the work they started on the Blockbaster (blockchain-based settlement technology research) project back in 2016. The functionality of blockchain technology in securities settlement and the cash leg settlement of transactions was successfully demonstrated in previous project phases.”