Blockchain from a Central Bank Perspective

Symposium jointly organized by the University of Zurich and the University of Lucerne

Zurich, 3 November 2017, 8:30 – 17:00

The Universities of Zurich and Lucerne are organizing a joint symposium on the use of blockchain or distributed ledger technology (DLT) for the issuance of central bank money and securities. The seminar will be held on 3 November 2017 at the University of Zurich.

The event is fully booked. We are running a waiting list. Please contact us if you wish to be put on the list.

Instructions for how to get to the conference venue can be found here.

Central Bank Digital Currency

The first part of the symposium is set to explore the economic, technical and legal conditions and ramifications for the issuance of central bank money on the blockchain in the form of Central Bank Digital Currency (CBDC). CBDC are widely available representation of fiat money based on the distributed ledger technology. Options which are currently being considered by central banks include the use of CBDC as a unit for the settlement of interbank transactions, CBDC as a substitute for physical cash (coins and banknotes), and CBDC as a new monetary policy tool. In the most extreme and disruptive scenario, CBCD could be used by the general public as a means of payment and store or value, potentially replacing current commercial bank deposits. It is obvious that such a move would have major implications on the financial and monetary system.

In a recent working paper the International Monetary Fund (IMF) provides a number of reasons why central banks might offer CBCD:

“A CBDC might resolve the coordination problem over new virtual currencies, and thus spur technological innovation. Alternatively, it might allow the central bank to retain control of monetary policy effectiveness, in case privately-issued virtual currencies started to gain significant ground […]. A DLT-based CBDC could also be more secure and resilient than current settlement systems which are exposed to single point of failure risk. Finally, by facilitating small value payments, it could boost the adoption and efficiency of the new, decentralized, service economy.”

Representatives of central banks currently exploring CBDC will first inform about the state of play. Academics will then explore CBCD from a  technical, economic and legal perspective.

Securities Clearing and Settlement

The second part of the symposium will discuss the legal framework for the issuance, the clearing and settlement of financial instruments on the blockchain. The World Economic Forum identified the application of DLT in the securities clearing and settlement as one of the most promising potential use cases for blockchain applications. It could greatly reduce complexities and risks inherent in the current financial market infrastructure, although concerns in relation to scaleability and reliability are still unresolved.

The symposium will first see presentations of various projects currently being developed. The issuance and the clearing and settlement of financial instruments on the blockchain will then be discussed from a legal point of view, including the regulation, property, insolvency and conflict of laws issues.

For more information see our flyer.