Bank of Canada: using DLT for payments still faces many hurdles

The project, which involves Payments Canada as well, seeks to understand how Distributed Ledger Technology might transform the future of payments, starting with high-value clearing and settlement. The results show that, despite progress made, underpinning an entire wholesale payments system with DLT still faces many hurdles.

Even if the project demonstrated the ability to settle wholesale payments on a distributed ledger, several important gaps remain. A stand-alone DLT wholesale system is unlikely to match the efficiency and net benefits of a centralized system, according to project participants. Furthermore, there exists a fundamental inconsistency between a centralized wholesale interbank payment system and the decentralization inherent in DLT.

Launched in 2015, the project is an experimental wholesale interbank payment system, using digital ledger technology (DLT). In 2016, Project Jasper made headlines when it became the first known blockchain experiment to include a central bank and the private sector.