Financial Stability Board seeks 'better understanding' of blockchain technology

Rage Comment : As an organization and coordinator beyond the national level, the FSB is required to play its role under the premise of satisfying the public interest, which makes the functions, decision-making, resources and organizational coordination issues faced by the organization extremely delicate and difficult. Judging from the information currently disclosed and the main functions of the FSB, it is mainly trying to gain a deeper understanding of blockchain technology, while considering the possibility of establishing a global unified coordination framework.

Translation: Prince Gong

The Financial Stability Board (FSB), a group of central bank governors and financial regulators from major economies around the world, has begun work on blockchain technology.

The work was revealed in a speech delivered by Subhash Sheoratan Mundra, deputy governor of the Reserve Bank of India, the country's central bank.

Mundra spoke at a regional bank conference on February 4, discussing digital currency and blockchain technology in the context of non-bank competition in payments.

Subhash Sheoratan Mundra

Mentioning that “large-scale disruption is entirely possible,” Mundra went on to suggest that banks “need to either have their own development capabilities or seek to form appropriate alliances,” referring to the alliances that some financial institutions have formed in the past to jointly research blockchain or distributed ledger technology.

Mundra went on to reveal that the FSB has already begun work on the technology, telling the audience:

“Having said that, however, we or global regulators have not yet reached a final position on the use of distributed ledger technology. It is important to stress that the Financial Stability Board has already started consultations to better understand the intricacies of this.”

The predecessor of the Financial Stability Board was the Financial Stability Forum (FSF), a cooperative organization established by seven developed countries (G7) to promote the stability of the financial system. Against the backdrop of the increasingly significant impact of emerging market countries such as China on global economic growth and financial stability, the G20 Financial Summit held in London on April 2, 2009 decided to expand the FSB membership to all G20 member countries including China and rename it FSB. The organization is chaired by Mark Carney, who is currently also the governor of the Bank of England, the central bank of the United Kingdom.

Mark Carney

Mundra was among the RBI officials who discussed the technology during the FIBAC2015 banking conference in Mumbai last August.

He said at that time,

"There are a variety of global innovations here, with very important attributes and designs... We're going to need a globally coordinated framework, not a region-specific framework."