Spanish banks required to report 3-year digital currency plans

Banco de Espana wants to assess the influence that digitalization has on financial services.

Digital currency plans by Spanish banks must now be reported according to sources at the Banco de Espana, which claimed that the central bank wants to examine the effect digitalization is having on financial services.

The Bank of Spain has been quiet for years on the subject of digital currencies. However, this year, it’s stepping up and asserting itself. After establishing a digital currency service providers’ registry, it’s moving on to the banks.

According to a report from Spain’s El País, the Banco de Espana is now on the lookout for additional information from financial organizations dealing with digital money.

The purpose of the research is to examine the effect that digitalization is having on financial services, not to prohibit or advocate digital currencies. The central bank is calling on commercial banks to disclose their ties with digital asset service providers, stakes in them, and any other exposure they may have to cryptocurrencies.

Banks that want to launch or offer custody for existing cryptocurrencies in the next three years must also detail such projects.

The latest development arrives as leading banks in Spain begin to embrace digital currencies. Banco Santander is the country’s largest bank, and it has stated that it is working toward a cryptocurrency exchange-traded fund. Other financial institutions are also at various stages in their digital asset initiatives, such as BBVA and CaixaBank.

As reported, Banco Santander and four top Spanish banks completed a proof-of-concept for payment transfers utilizing smart contracts. Banco Santander also reportedly redeemed its blockchain-based bond in 2019.