VIDEO | A shift toward 24-hour payment systems is becoming a priority for central banks as digital currencies and blockchain technology continue to transform the financial sector. Speaking at the PostTrade 360° Nordic Conference, experts agreed that while existing payment systems are functional, they are increasingly inefficient in the face of new technological advances and growing demands for constant availability.

“Central banks need to move beyond fixed hours and start partnering with third-party infrastructures to achieve round-the-clock settlements,” said Phil Mochan, CEO of Nomos Digital. He pointed to projects like Fnality International, which is already enabling payment systems to operate outside traditional banking hours. “The Bank of England is one of those making the most progress in that,” Mochan added, emphasising the need for resilience and flexibility in today’s financial infrastructure.

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While digital currencies are often seen as revolutionary, the concept of money evolving through different forms is far from new, explained Elise Soucie, executive director of Global Digital Finance. “Money changing forms isn’t a new thing,” Soucie noted. The real transformation lies in the technology—blockchain and distributed ledger technology—that has the potential to change how payments are processed.

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Compliance and the blockchain challenge

As blockchain technology gains traction, compliance remains a key concern, particularly around anti-money laundering (AML) and know-your-customer (KYC) regulations. Guillaume Chatain, head of Sales at Societe Generale – Forge, detailed how his company ensures compliance with on-chain analytics tools, which monitor wallet transactions to flag suspicious activity. “From my point of view, it is a much better solution than what you would have in the physical world,” Chatain said, referring to traditional paper-based systems.

Societe Generale’s subsidiary, SG Forge, has developed a Euro stablecoin on a public blockchain, a move that required careful oversight from regulators. “We’ve received approval from our regulator, the ACPR in France, to make this fully permissionless and fully transferable, as long as we abide by the processes,” Chatain said.

Permissioned vs. permissionless blockchains

One of the most significant discussions revolved around the difference between public permissioned and public permissionless blockchains. While public blockchains offer the potential for greater transparency and accessibility, many regulators are wary of their use in wholesale banking. “In wholesale markets, legal certainty is critical,” said Rhomaios Ram, CEO of Fnality International. “So it is hard to see wholesale money transferring on a public permissionless chain.”

Ram’s company is creating a private-sector answer to central bank digital currency, using blockchain to settle transactions efficiently in fiat currency. The system has already been deployed in the UK and is expanding to the U.S. and Europe. “We’re focused only on wholesale,” Ram explained. “The current settlement system works, but it’s inefficient from a balance sheet perspective.”

Zero-knowledge proofs: a privacy solution?

As blockchain technology evolves, privacy remains a significant concern, particularly in public blockchains where transaction histories are visible to all. An audience member introduced the idea of zero-knowledge proofs, which allow users to prove the legitimacy of transactions without revealing any sensitive information. Soucie was optimistic about the potential of this technology, stating, “Zero-knowledge proofs are amazing, and they could transform the privacy question.” She added that the ecosystem is still evolving and emphasised the importance of keeping an open mind: “We shouldn’t rule out any potential future uses for private or public blockchains, whether permissioned or permissionless. As the ecosystem develops, risks should be mitigated, and regulations should be designed to be future-proof, allowing for new use cases as they emerge.”

However, Ram pointed out that wholesale markets would still require robust governance and legal frameworks, which public blockchains currently lack. “There needs to be clear lines of governance—who is in charge if something goes wrong?” he said.

“It’s all about the journey”

The panelists agreed that interoperability will be crucial in the future. Olaf Ransome, director of 3C Advisory, called it the “holy trinity” of digital finance, referring to the integration of marketplaces, asset custody, and means of payment. “It’s interoperability that enables the orchestration of those three parts,” he explained.

The discussion concluded with a call for cooperation between regulators and the industry to ensure that innovation does not outpace oversight. “We need to bring regulators on the journey,” Soucie emphasised. “It’s all about the journey with the regulator.”

Panellists:
Guillaume Chatain, head of Sales, Societe Generale – Forge
Phil Mochan, founder and CEO, Nomos Digital
Rhomaios Ram, CEO, Fnality
Elise Soucie, executive director, Global Digital Finance

Moderator:
Olaf Ransome, director, 3C Advisory


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