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A European Central Bank director has called on banks to embrace instant payments to suppress the disruptive threat posed by cryptocurrencies like bitcoin.

Speaking at an event in Rome, European Central bank director Yves Mersh dismissed digital currencies and called on retail, commercial banks to embrace instant payments to counter the rise of cryptocurrencies.

In quotes reported by Reuters, Mersh said:

Banks need to implement instant payments as soon as possible and provide an alternative narrative to the ongoing public debate on the alleged innovation brought by virtual currency schemes.

Mersh’s remarks echo those of another central banker in Jens Wiedmann, president of Germany’s Bundesbank, who called for banks to make existing payment systems more efficient and faster with instant payments. “I’m pretty confident that this will reduce most citizens’ interest in digital currencies,” Wiedmann said earlier in June.

Mersh also revealed initiatives by the European Central Bank (ECB) to “experiment with cash on different digital technologies” while claiming not to see any scope for “adventurous applications” of new innovative financial technologies, at least, by the central bank.

“We shall also experiment with cash on different digital technologies,” Mersh reportedly stated. “Other adventurous applications of a more disruptive nature are simply not robust enough.”

The ECB director joins a number of other colleagues in the same institution to offer their take on decentralized cryptocurrencies, in recent months. ECB executive board member Benoît Cœuré revealed that the ECB and other central banks “aren’t ignoring” cryptocurrencies.  ECB vice president Vitor Constancio weighed in to add that “so-called private cryptocurrencies can never prevail” over fiat currencies.

The most telling statement, however, came from the ECB’s president in late September. “[I]t’s not within our powers to prohibit or to do something of the nature…or to regulate bitcoin,” ECB chief Mario Draghi admitted recently, confirming that the ECB had no authority, nor the power, to prohibit decentralized cryptocurrencies.

Featured image from Shutterstock.

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