Minister Donohoe publishes discussion paper on virtual currencies and blockchain technology

Working Group to monitor cryptocurrency developments established within Department of Finance

The Minister for Finance and Public Expenditure and Reform, Paschal Donohoe TD today (Thursday) published a discussion paper prepared by his Department on virtual currencies and blockchain technology, and announced the subsequent creation of an internal working group to monitor further developments in this area.

This follows the Department’s active research into virtual currencies and the blockchain ecosystem that exists in Ireland, Europe and globally. The discussion paper comprises an overview of virtual currencies and the blockchain technology supporting them; summarises actions taken by selected countries around the world; and sets out the key risks and opportunities these technologies present.

The discussion paper concludes with a recommendation to establish an internal working group to coordinate the Department’s engagement in this area, both locally and abroad.

Minister Donohoe commented:

“Consumers and investors should be aware that buying and exchanging virtual currencies comes with considerable risks. Virtual currencies remain an unregulated activity, and the prices at which they are traded remain highly volatile.

“However, while investing in virtual currencies may involve risks, the blockchain technology that underpins them has the potential to be a catalyst for innovation in the financial services sector and elsewhere. One of Ireland’s strengths is its ability to innovate and adapt to emerging trends across finance and technology and I have spoken before about the importance of developing clusters in key growth areas as a way of nurturing Ireland’s knowledge economy.

“The Government’s IFS2020 vision is to be recognised as a global location of choice for specialist international financial services by building on our strengths in talent, technology, innovation and excellent client services, while focussing on capturing new opportunities in a changing marketplace and embracing the highest standards of governance. By engaging with virtual currencies and blockchain technology, Ireland, through the work undertaken by the Department of Finance, can be instrumental in creating a predictable and open blockchain ecosystem in Ireland and furthering that ambition.”

ENDS

Note to editors:

Previously, the Central Bank of Ireland issued alerts on Initial Coins Offerings , echoing the warnings published by the European Securities and Markets Authority (ESMA) in November of 2017 and the European Bank Authority EBA in December 2013. Most recently, in February of this year, the Central Bank of Ireland issued warnings to consumers and investors regarding the risks of investing in virtual currencies.