Financial market infrastructures: Walking the line between stability and innovation
In his welcome speech at the opening of Sibos in Geneva, Thomas Jordan, Chairman of the Governing Board of the SNB, stressed that the challenge for regulators and central banks is to make sure they fully understand the effects – and side-effects – of new mechanisms at an early stage. Central banks and regulators have a duty to protect the safety of financial market infrastructures, but they also have a duty to ensure that they operate efficiently.
According to Jordan, it is conceivable that security-specific information could be settled via a distributed ledger, while the payment leg could continue to be effected via a traditional, centralised payment system. "I do not, however, believe that decentralisation will become the 'new normal' in all financial market functions and infrastructures."