The head of the digital innovation and blockchain unit of measurement at the European Commission (EC), Pēteris Zilgalvis, explained the concise benefits of distributed ledger technology (DLT) in an interview to The Banker, a subsidiary of the Financial Times. In the interview, published on Apr 3, Zilgalvis talked nearly the benefits and challenges of the engineering science.

According to him, blockchain provides a powerful framework for data sharing, something that can't exist washed past normal databases:

"We retrieve that it presents an fantabulous technology for situations where unlike stakeholders need to collaborate merely, due to competition or legal reasons, they exercise non want to or are unable to share a single database."

He added that blockchain is not "the solution for everything," but there are applications such as certificate certification, self-sovereign identities and regulatory reporting, where DLT is "thirty% to lxxx% more efficient."

Sharing data betwixt members of a grouping

The distributed nature of blockchain is particularly useful in the context of the Eu, where it provides a way of coordinating data betwixt member countries without sending it to a central location in Brussels or Luxembourg.

This is the rationale behind the European Blockchain Services Infrastructure, which aims to bring public services into a pan-European context. One of the potential uses of EBSI is connecting European banks in terms of their regulatory reporting, for example past sharing client data gathered in their anti-money laundering efforts.

Zilgalvis noted that this is a bigger challenge than it may seem, as banks are reluctant to exercise and so due to concerns about competition and user privacy regulations.

The European blockchain effort is finding more issues with the political attribute rather than technological, as Zilgalvis revealed:

"The biggest claiming is governance. The best utilise cases for blockchain are where it is non 1 enterprise or entity but many. Thus, governance is important."

On the technology side, efforts are being made to improve scaling, consensus mechanisms and privacy.

Blockchain and crypto

Different some other governments, namely China, the European Matrimony'south blockchain efforts are besides coupled with a relaxed stance on cryptocurrencies, according to Zilgalvis"

"We haven't made whatsoever moves to prohibit anything, which stands against the stereotype of 'if information technology moves, Europe regulates information technology.'"

He added that crypto is regulated through the same principles every bit any currency and that any future changes volition be "very much washed in a 'pro-innovation' spirit."

European countries are indeed traditionally open up to crypto, with recent examples of favorable treatment being found in both France and Germany.

The European Central Bank is besides pushing for issuing a "digital Euro" in response to Libra and similar worldwide initiatives. Zilgalvis, while noting that this is not EC'due south expanse of competence, urged the depository financial institution to determine the advantages and risks of the proposal. He added:

"Obviously for the EC, and the EBSI initiative, it would exist easiest for us to utilize the euro in our blockchain infrastructure rather than another digital currency or cryptocurrency."