As the blockchain is finding more and more real-world applications, the European Union has realized its potential and plans to fully explore this new technology.
The European Commission (EC) held a conference titled ‘Uniting EU Industries to lead blockchain technologies’ that gathered representatives from both public institutions and the private sectors. One of the EU companies that was invited to participate in the discussion was Spanish banking giant BBVA.
BBVA announced yesterday, November 23, that along with four other banks they have become members of the EC’s planned International Association for Trusted Blockchain Applications (IATBA). The association could become a legal entity in the first quarter of 2019. Another official member is Banco Santander, the Spanish banking giant.
The association’s role will be to promote EU standards and internal operability, develop sector-specific protocols and guidelines, and ensure regulatory convergence to support blockchain technology exploitation.
During the talks, BBVA representative Carlos Kuchkovsky, head of research and development, New Digital Business, said it’s “essential to establish a system of governance that aligns the different participating industries and their objectives.”
He also thinks the European Council’s enterprise will offer more clarity to the “regulatory uncertainty” that’s currently affecting blockchain technologies. Kuchovsky explained:
“Blockchain is not only a technology, but it engenders new business models creating a tokenized economy and paving the way to a decentralized economy in the future.”
He also said that blockchain and other new technologies need to be understood as tools that ensure digital ecosystems are reliable. Even so, he is convinced a system of governance needs to be established that “aligns the different participating industries and their objectives.”
The EC has also formed the European Blockchain Partnership (EBP) in April, along with 27 member countries as part of its effort to adopt and develop blockchain across the economic block. The project’s main focus is to support the delivery of cross-border digital public services.
Regarding IATBA, BBVA said it should be comprised of representatives from both public and private sectors with a focus on drawing support from private blockchain experts to help plan the European Union’s strategy for these technologies.
IATBA will create guidelines and protocols for the blockchain industry, as well as promote EU’s blockchain standards internationally.
In February 2018, the EU Blockchain Observatory and Forum was launched by the European Commission. So far, more than 80 million EUR have been invested in projects supporting the use of blockchain in technical and societal areas. The plan is to allocate an additional 300 million EUR to blockchain by 2020.
BBVA recently completed a pilot that placed a syndicated loan for $150 million on the blockchain. The syndicated loan involves several banks lending to just one borrower. Among the co-lenders, there were companies such as BNP Paribas, and Mitsubishi UFJ Financial Group. A while back, BBVA completed another pilot that issued a $91 million corporate loan which used the Ethereum blockchain and a private digital ledger.