Bank of Estonia Finds 'Unlimited' Potential in Digital Euro Test
Eesti Pank found a blockchain-based solution could support an almost unlimited numbers of payments being processed at the same time.
Jul 28, 2021 at 11:40 a.m. UTCUpdated Aug 21, 2021 at 6:29 p.m. UTC
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Estonia's central bank made bold claims about the scalability of a blockchain-based digital euro following an experiment conducted with some fellow euro-area central banks.
- Eesti Pank found that the "novel blockchain-based solution could in theory support almost unlimited numbers of payments being processed at the same time," an announcement Monday said.
- Working alongside the European Central Bank (ECB) and the central banks of Spain, Germany, Italy, Greece, Ireland, Latvia and the Netherlands, Eesti Pank's experiment used the same blockchain technology that forms the basis of the country's e-Estonia digital society, a movement to digitize all interactions between citizens and the state.
- The experiment saw participants with digital identities send payments in digital money between Estonia, Latvia, Lithuania and Spain.
- The system was able to handle more than 300,000 transactions a second with funds reaching beneficiaries in less than two seconds.
- "This technology does not set any essential limits on the size of the money supply," Eesti Pank said. "The system is able to handle the entire supply of euros in circulation and more."
- The ECB said earlier this month it was starting the investigation phase of developing a digital euro in a program set to last 24 months.
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CORRECT (JULY 28, 11:44 UTC): Corrects bank's name to Eesti Pank.
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