Italy has chosen the Algorand blockchain to bring improvements to its existing banking systems from 2023. This officially makes Italy the first European Union (EU) member country to blend blockchain with its financial and insurance systems. Blockchain technology, which is also the underlying technology of cryptocurrencies, is now being explored by several countries to increase transparency in the banking sector.
Essentially, Algorand will support an upcoming digital guarantee platform in Italy to issue bank and insurance guarantees on blockchain, a digital ledger technology (DLT).
Insurance or bank guarantees are goods promised by banks or insurance companies to mitigate losses in the event of a loan default. A Blockchain A twist in the issuance of these guarantees could make the records more immutable and therefore more transparent.
“Our goal is to help Italy not only recover from the economic impact of COVID-19, but also excel through innovation and leadership. Our ecosystemic projects are designed to help create strategic platforms powered by Algorand. We selected Algorand for its unparalleled level of security among permissionless DLTs and for its sustainability,” said Federico RajolaProfessor at the Research Center for Technologies, Innovation and Finance of the Catholic University of Milan (CETIF), in a press release.
Members of Algorand, Bank of Italy and Italian insurance regulator IVASS met in Milan this week to discuss blockchain use cases in the banking sector. Over 30 financial organizations also attended this meeting. The official Twitter handle of the layer 1 blockchain platform announced this development on Tuesday.
Earlier this year, Italy’s Ministry of Economic Development planned Investing $46 million (approx. Rs. 360 crore) in subsidies for the development of projects in the area Blockchain technology as well Artificial Intelligence (AI)and Internet of Things (IoT).
Italy this month suggested a draft crypto law that would allow the country to levy a 26 percent tax on crypto profits exceeding $2,000 (about 1.62 lakh).
Italy’s Algorand-powered platform is expected to go live in 2023.
released in 2019, Algorand is a green Proof-of-Stake (PoS) blockchain. Blockchain developers claim to enable convergence between them Decentralized Finance (DeFi) and traditional finance.
Recently, the blockchain was also chosen by the Government of Maharashtra in India to store and support healthcare data as NFTs.
