Traditional finance could benefit from the unrestricted adoption of blockchain technology, suggests a recent EU paper.
The European Union has published a report delving into the potential for permissionless blockchains in traditional finance (TradFi). The comprehensive and unbiased analysis was penned by Fabian Schaär, a professor at the University of Basel and one of the most cited early authors in the field of Decentralized Finance (DeFi).
Schaär, who is also a proponent of permissionless blockchains and DeFi, argues that these technologies could have significant applications in TradFi and financial market infrastructures. However, the report advocates a cautious approach to their adoption.
The report does not call for immediate implementation of permissionless blockchains in TradFi. Instead, it suggests that these technologies should at least be considered as options for TradFi and financial market infrastructures. This cautious stance is echoed throughout the report, which underscores the need for careful consideration and thorough evaluation before any widespread adoption.
The report, published by the European Union, is part of ongoing efforts in digital finance around 2024-2025. These efforts include the digital euro project and related blockchain explorations, with significant developments anticipated around 2024-2025, aiming for a digital euro launch by October 2025.
Despite the report's objective and thorough nature, no single editor of the specific permissionless blockchain report has been publicly identified. The report and studies are integral components of the EU's broader digital finance initiatives.
In conclusion, the European Union's report on the potential use of permissionless blockchains in conventional finance presents a thoughtful and measured approach to the integration of these technologies into the traditional financial landscape. The report's emphasis on a cautious and considered approach to adoption reflects the importance of ensuring the stability and security of financial systems as these technologies are integrated.
