Here at Fnality International, we were pleased to see Christina Segal-Knowles, Executive Director, Market Infrastructure Directorate at the Bank of England address the challenges and opportunities in payments post Covid on 11th June 2020. The key points that we take from the speech are as follows:
- There is a recognition that the way wholesale and retail payments are made will continue to evolve rapidly driven by private sector innovation, with a particular focus on the emergence of so-called stablecoins.
- BoE has two key principles that Fnality agrees with:
- Payments need to be secure and reliable
- Stablecoins need to offer the same protections as current forms of money
- BoE will continue to take a technology neutral approach applying “same risk, same rules” principle to new forms of payments.
- Where stablecoins are used in systemic payment chains as money-like instruments, they must meet standards equivalent to commercial bank money in terms of stability of value, robustness of legal claim and the ability to redeem at par in fiat.
Fnality is fully aligned with the BoE views on approach.
At Fnality International, we are building a new payments system with cash-on-ledger that will exactly meet these criteria. This will enable tokenisation and blockchain adoption in wholesale banking and capital markets.