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Fiat cash preventing Blockchain tests

Fiat currencies prevent innovation in the blockchain.

01.Nov.17 6:13 AM
By Daria Zaytseva


Fiat cash preventing Blockchain tests

This is the view of David Harris, head of commercial innovation at the London Stock Exchange Group (LSEG).

In a keynote speech at the third annual London Blockchain Summit today, Harris told about 150 world bankers, insurers and technology suppliers that he looks forward to a day when central banks will issue their own cryptocurrency.

Although this is not a new desire, the reason why Harris wants to switch to the equivalent of the cryptocurrency, in particular, derives from the role of LSEG in the Borsa Italiana project, which considers the issue of securities on a blockchain. But even with testing, when several private companies were granted access to services normally reserved for public firms, LSEG continues to face obstacles related to paying for securities with cash.

The statements emphasize that, although some central banks have recognized cryptocurrencies as a threat and pass to their prohibition, others are actually exploring the potential benefits of issuing fiat currency on a blockchain.

But, Harris realizes that there are factors that could hinder quick embraces. Since blockchain technology was in large part developed to make banks and other intermediaries unnecessary, once the central bank decides to issue a cryptocurrency, that might cast doubt on the whole concept of commercial banking, Harris said.

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