European regulators are under the impression that “open” blockchains may be inappropriate for financial services.
The European Securities and Markets Authority concluded as much in a recent discussion paper. We responded by quickly filing a comment that explains the benefits of open blockchains and reminds ESMA that there is nothing inherently unsuitable about these technologies for financial markets applications.
That was one of the conclusions of the European Securities and Markets Authority in a discussion paper on its Consultation on the Distributed Ledger Technology Applied to Securities Markets on which it sought comment. We filed a detailed comment letter with ESMA explaining that “the presumption that only permissioned-based systems are ‘likely’ to be used in financial markets is premature.” We explain that there is nothing inherent in open blockchain networks that makes them inappropriate for use in financial markets or inferior to permissioned systems on the margins of efficiency, security, or privacy. The whole thing is worth reading.