Global ‘Finternet’: BIS Envisions Unified Ledger Technology
In a recent paper coauthored by BIS chief Agustin Carstens, the Bank for International Settlements (BIS) presented a compelling argument for the use of unified ledger technology in the financial system. The paper introduces the concept of a “financial system for the future” called the Finternet, which would utilize unified ledgers as its foundation. According to the paper, unified ledgers have the potential to address various pain points in the current financial system by enhancing speed, compliance, and privacy.
Unified ledgers differ from other digital transaction platforms as they bring together multiple financial asset markets on common programmable platforms. They offer advantages by combining all the necessary components for financial transactions, such as financial assets, ownership records, rules, and relevant information, in a single venue. This eliminates the reliance on siloed proprietary databases and third-party messaging systems.
It is important to note that the BIS does not propose a single unified ledger system. Instead, it envisions multiple unified ledgers interacting with each other and the broader financial system through applications. These ledgers would require tokenization of assets, particularly money, to enable transfers using smart contracts. A tokenization manager role would be established to oversee regulatory requirements in this process.
The concept of unified ledgers was first introduced by Carstens in February 2023 and gained further attention in the 2023 BIS annual report. The recently announced Project Agora, involving the BIS and seven central banks, relies on unified ledger technology for central bank digital currency and tokenized money transfers. The idea has also been explored by SWIFT, the global financial messaging service. The International Monetary Fund has put forth a similar proposal with its XC platform.
The BIS strongly advocates for the adoption of unified ledger technology in the financial system. Unified ledgers have the potential to address many existing challenges by improving speed, compliance, and privacy. It is important to recognize that the implementation of unified ledgers would require tokenization of assets and careful monitoring of regulatory requirements through a designated tokenization manager. With continued research and development, unified ledger technology may revolutionize the future of finance.
10 thoughts on “Global ‘Finternet’: BIS Envisions Unified Ledger Technology”
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Wow, the idea of unified ledgers and the Finternet is fascinating! The potential for improved speed, compliance, and privacy in the financial system is truly exciting. I’m impressed by how unified ledgers bring together all the necessary components for financial transactions on a single platform. The tokenization of assets and the role of a tokenization manager in ensuring regulatory requirements make it a well-rounded solution. This could be a significant step forward for finance!
I highly doubt that unified ledgers will actually improve compliance. If anything, it will make it easier for those with ill intentions to exploit loopholes and evade regulations.
So, the BIS wants to rely on proprietary databases and third-party messaging systems? Yeah, because that worked out so well in the past. I’m not convinced at all.
It’s laughable to think that unified ledgers will revolutionize the future of finance. We need real solutions, not just more tech hype and empty promises.
I’m really impressed by the concept of unified ledgers and the Finternet! The idea of bringing together multiple financial asset markets on common programmable platforms is genius. The potential benefits of improved speed, compliance, and privacy in the financial system are groundbreaking. It’s great to see the BIS taking the lead in advocating for unified ledger technology. This technology has the potential to revolutionize finance and pave the way for a more efficient and secure future.
Unified ledgers could be a game-changer for the financial system! The concept of combining all the necessary components for financial transactions in a single venue is brilliant. I’m thrilled about the potential improvements in speed, compliance, and privacy that this technology offers. The BIS’s strong advocacy for unified ledger technology is commendable. Tokenization of assets and careful monitoring of regulatory requirements are crucial for its successful implementation. Exciting times ahead for finance!
The concept of unified ledgers and the Finternet is truly intriguing! The potential to improve speed, compliance, and privacy in the financial system is mind-boggling. I appreciate how unified ledgers eliminate the reliance on siloed proprietary databases and third-party messaging systems. The tokenization of assets and the role of a tokenization manager to oversee regulatory requirements ensure a responsible approach. Exciting times ahead for the financial industry!
I’m fascinated by the idea of unified ledgers in the financial system! The concept of combining multiple financial asset markets on common programmable platforms seems like a logical step forward. I’m excited about the potential benefits of improved speed, compliance, and privacy that unified ledgers could bring. It’s great to see the BIS advocating for this technology and exploring its implementation through Project Agora. With proper monitoring of regulatory requirements, this could truly transform finance!
Just what we need, another complex and convoluted system that can potentially be exploited and lead to even more financial crises. Great job, BIS.
Let me guess, the implementation of unified ledgers will come with hefty fees for the average user while the big players get special privileges. No thanks, BIS. 👎