What the Heck Does “Better” Mean? Many Will Disagree ECB’s TIPS Is “Better” Than Blockchain

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This article in Bloomberg ran the headline “ECB’s Mersch Says His Payment System Is Better Than Blockchain.” This might be true if the “problem” is defined as how Euro’s can be sent between EU banks in a centrally managed and centrally regulated network:

“The technology behind cryptocurrencies has been hyped as making payments fast, and secure and easy. European Central Bank Executive Board Member Yves Mersch says he can do even better.

The ECB is getting ready to launch its new settlement system, known as TIPS, in November. Policy makers have urged banks previously to implement the technology — which will allow transactions to be conducted in real time — in order to provide an alternative narrative to the seeming innovation brought by the distributive ledger technology of virtual currencies.

‘TIPS is 10 seconds, 0.2 cents. DLT transactions are at best 30 euros and take at least one hour,’ Mersch said in an interview on Tuesday. ‘We have a mandate for efficient payment systems, and we go for efficiency. We are not bound to a technology, we are bound to results.’ ”

These statements sound pretty defensive to me; and I’m someone who has argued blockchain technology is likely inappropriate for 90% of all the applications it has been applied to.  I suspect even Mr. Mersch would agree that if the ECB had to solve the same problems that Ripple is trying to address, TIPS wouldn’t be better at all, it would be much worse (well, until everyone in the world agrees both to use Euros and to be regulated by the ECB).. Sure, then TIPS probably wins, although I am sure I will hear arguments about even that.

This prowith those restrictions stated:

Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group

Read the quoted story here