Blockchain settlement solution trials proved expensive and slow, Bundesbank president says

The Bundesbank and Deutsche Boerse ran a trial project using blockchain technology, and its conclusions are not optimistic, Bloomberg writes. As Germany’s central bank president Jens Weidmann explained, the use of a blockchain solution to transfer and settle securities and cash did not give satisfactory results. Although it met “all basic regulatory features for financial transactions,” it did not deliver a faster and cheaper solution.

“The blockchain solutions did not fare better in every way: the process took a bit longer and resulted in relatively high computational costs,” Weidmann said in Frankfurt.

Weidmann claimed tests run by other financial institutions have yielded similar results. “Despite numerous tests of blockchain-based prototypes, a real breakthrough in application is missing so far,” he said.

Weidmann has also spoken against central bank digital currencies, saying their introduction could lead to destabilisation of the financial systems.