Blockchain technology can be implemented in conventional finance without the need for authorization, according to a new paper in the EU.
In a groundbreaking move, the European Union has published a report exploring the potential for permissionless blockchain technology in traditional finance, often referred to as TradFi. The comprehensive report, authored by Fabian Schaär of the University of Basel, is one of the most cited early papers on Decentralized Finance (DeFi).
Schaär, a proponent of permissionless blockchains and DeFi, presents an objective and thorough analysis of the technology's application in TradFi. The report considers permissionless blockchains as options for TradFi and financial market infrastructures, but does not solely advocate for their adoption.
The report suggests that the adoption of permissionless blockchains in TradFi should happen in a cautious manner, emphasising the need for careful consideration and regulatory frameworks. The European Union's report does not specify any timeline for this cautious adoption.
The report, focused on the application of permissionless blockchain in TradFi, highlights Schaär's ongoing research at the University of Basel. He is currently investigating decentralized finance and blockchain-based financial market infrastructure, with a particular focus on permissionless blockchains and their governance applications in traditional finance.
While the report underscores the potential benefits of permissionless blockchains in TradFi, it also acknowledges the challenges that come with implementing such technology. Schaär's work serves as a valuable resource for policymakers and industry stakeholders navigating the intersection of blockchain technology and traditional finance.
In conclusion, the European Union's report on permissionless blockchain in TradFi offers a thoughtful and balanced perspective on the potential role of this technology in the future of finance. As research and development in this area continue to evolve, Schaär's work will undoubtedly remain a key reference in the ongoing conversation about the future of finance.
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