This week the Bank of England published a blog post summarizing its analysis of the governance of public blockchains. It asks how one should govern a blockchain that becomes a critical piece of financial infrastructure. The focus was on permissionless blockchains and, for now Ethereum, although it notes that it does not consider the blockchain as critical. Yet.
“In the traditional financial system, critical financial infrastructure is regulated to deliver an appropriate level of responsibility, accountability, and control,” says the blog post. “So, there is a question as to what appropriate regulatory oversight of a blockchain could entail, were it to become a more critical piece of infrastructure in the financial system.”
It pointed to the Ethereum Merge, a highly risky move from Proof of Work to Proof of Stake to secure the network. Frankly, it’s hard to criticize the transition at a technical or process level, and one has to question whether conventional institutions could have handled it better.
Article continues …
Want the full story? Pro subscribers get complete articles, exclusive industry analysis, and early access to legislative updates that keep you ahead of the competition. Join the professionals who are choosing deeper insights over surface level news.
