- Circle submitted a response to the Central Bank of Ireland on how public blockchains can improve consumer protection.
- The benefits of blockchain technology include increased competition, disaggregation of financial services, privacy protection and improved financial literacy through transparency.
- Circle recommended that financial supervisors support innovation while protecting consumers‘ best interests.
Circle Recommends Adoption of Public Blockchains for Consumer Protection
USDC issuer Circle has engaged with the Central Bank of Ireland to promote the benefits of blockchain technology for improving consumer protection. In its response to the discussion paper issued by the Central Bank, Circle outlined how public blockchains can help increase competition, reduce costs and improve capabilities in fighting illicit finance. The firm also provided recommendations on how financial supervisors can support innovation while ensuring consumers’ best interests are protected.
In its response, Circle highlighted several potential benefits associated with using blockchain-based payment systems for consumer protection:
- Increased Competition:
- Disaggregation of Financial Services:
- Improved Financial Literacy:
- Enhanced Capabilities in Fighting Illicit Finance:
Recommendations from CircleIn addition to explaining how public blockchains can benefit consumers, Circle also offered recommendations on how regulators should proceed when dealing with firms offering novel products such as stablecoins:
- Engage With Supervisory Authorities Before Applying: li >Firms should engage with supervisory authorities prior to filing a formal application so they have time to consider any potential risks associated with their product before it is released into the market place. ul >
< ul >< li >< b >Actively Inform Consumers About Market Abuse/Anomalies : b >< / li >< / ul >Regulators should actively inform consumers about any irregularities or anomalies seen in transaction data so they are aware of any potential risks associated with using a particular product or service .
< h2 >Conclusion h 2 >Overall , Circle’s response highlighted both the potential benefits and risks associated with using public blockchains for consumer protection . By engaging early with regulatory bodies , firms offering novel products such as stablecoins will be able to ensure appropriate measures are taken ahead of launch . Similarly , active efforts from both industry stakeholders and regulatory bodies will be needed if we wish to realize the full potential that blockchain technology offers when it comes safeguarding our finances .