BTC inefficient as a large-scale payment solution, says Spain's central bank

17 Feb, 2019
by Richard Allen
Bitcoin
BTC inefficient as a large-scale payment solution, says Spain's central bank

Banco de España (BDE), Spain’s central bank, published a report that concludes Bitcoin is inefficient as a payment system.

Titled ‘Bitcoin: A solution for payment systems or a solution in search of a problem?’, the report analyses whether Bitcoin is sufficient in its current state to be used as a payment mechanism. The report’s author, BDE’s Deputy General Director of Financial Innovation and Market Infrastructures, Carlos Conesa, ultimately decided that it isn’t.

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The report makes reference to decentralization and a lack of intermediaries as primary limitations in Bitcoin’s inability to succeed as a large-scale payment system. Specifically, the report states decentralization requires a “process of intensive validation in the consumption of resources, which reduces system efficiency.” By comparison, “centralized systems with an intermediary trusted by the parties allow the design of much simpler and cheaper systems.”

Conesa states that an effective payment system should facilitate the sending of money between two parties simply, economically, quickly, and safely. Bitcoin, in his opinion, doesn’t pursue these goals.

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Read more about: Bitcoin (BTC) Spain

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