Blockchain technology as a way to a Inclusive Digital Economy according to the G20

 

In order to adress the convulsions and transformations faced by the global financial system, some countries and governments are betting on unknown lines of investigation, such as Blockchain.

Among the advantages of Blockchain include improvement in information security, drop in operating costs, reliability and transparency. These advantages, among others, increase transparency of operations managed by governments, allowing control over certain institutions which would mean a definitive blow against corruption.

In this sense, last March 15th in Frankfurt, was held the 9th Annual Conference of the G20 under the German Presidency. One of the issue addressed at the conference was Blockchain technology and its involvement in the future state of the global economy.

From this meeting, the report published by the Centre for International Governance Innovation (CIGI), an organization attached to the G20, concludes the strengths and advantages of applying Blockchain technology in structural areas of the economy, which would help generate an decentralized, accountable, transparent and inclusive economies.

According to Julie Maupin, an ally of the CIGI’s International Legal Research Program (ILRP) and author of the report, “G20 has an extremely important opportunity for the future finance, by initiating experimentation with this technology”.

The report urges G20 to take concrete action while the technology is in its development process, to minimize risks and take advantage of opportunities, and meet the challenge to convince citizens and financial institutions.

The idea of boosting Blockchain´s technology research, beyond its advantages, is due to the concern about certain risks. The report points out that technology could displace or exceed the capabilities of some intermediaries “on whom governments historically have relied on to implement important regulatory safety mechanisms”.

Currently, more and more governments are interested in positioning the interests of their State within the benefits offered by this tool for finance. German Bundesbank, US Federal Reserve, as well as the Reserve Banks of Australia and India, and Central Banks of Europe, England, Japan and China are among the entities already investigating the technology.

Therefore, it is an ideal time for G-20 to adopt a stance and set the guidelines for public policies that will help initiatives that have a bearing on Blockchain and its application in the financial sector.

Full report of the Centre for International Governance Innovation can be found here.