Dutch Bank: Blockchain Not Effective Enough for Payments
June 8, 2018
The central bank of Netherlands has concluded, integrating blockchain into the current payment system would make it less effective. The corresponding entry was posted in the bank’s official blog on June 7.
The message says, the main reason why implementing distributed ledger technology instead of the existing payment infrastructure is not effective is blockchain lacking scalability with large number of transactions.
To prove this the bank cites to the Dukaton activity. Within the framework of the project four blockchain prototypes were tested to define possible benefits adopting blockchain may bring to the current payment system.
The study of all prototypes has shown that although blockchain system is able to make payment more resilient to external attacks it has got a number of grave disadvantages of scalability, turnover capacity and efficiency.
“The current payment systems are very efficient, can handle large volumes and provide the legal certainty of payment. The blockchain solutions tested show that they are not sufficiently efficient, with regard to costs and energy consumption, and they can not handle large numbers of transactions.”
Despite all this the bank keeps monitoring blockchain and is going to hold new experiments. Rememeber that over the last months central banks in two other countries held similar experiments. The Taiwan’s central bank also recognized the technology as insufficiently effective while the South Africa’s Reserve Bank stated the tests were successful.