General manager of the Bank for International Settlements Agustín Carstens spoke at the Singapore FinTech Festival on Feb. 22 and described the digital financial infrastructure he believes would best suit central bankers’ needs. He called that infrastructure a “unified ledger.”

Carstens compared the theoretical unified ledger with a smartphone, saying they both work seamlessly with a variety of components. Unlike a smartphone, a unified ledger would have open architecture, however, and would show programmability and composability, that it, it would run and bundle smart contracts. There are over 2 million apps available to smartphone users, Carstens noted. He said:

“A unified ledger is a digital infrastructure with the potential to combine the monetary system with other registries of real and financial claims.”

A unified ledger would not have to be decentralized or permissionless, Carstens said, but could accommodate a variety of projects that “use of money as a means of payment and settlement” where the central bank plays a large role in the governance of the ledger and the consumer-facing sector is in private hands.

What a major validation of our #CBDC design! Checkout the BIS paper making the case for a #DLT based CBDC where Central Bank Money, #Tokenized Deposits and Other #stablecoins coexist on common ledger with #ecosystem and #regulatory frameworks #whysandbox https://t.co/yR1WCzzYU7

— EMTECH (@emtech_inc) February 22, 2023

Central bank digital currency and tokenized deposits could exist in “partitioned” sections of the ledger, with smart contracts to facilitate their interaction, Carstens said. The ledger could be used for everything from micropayments on the Internet of Things to escrow in real estate transactions.

Related: BIS to launch stablecoin monitoring project and up focus on CBDC experiments

Carstens took the opportunity to express his current thinking on stablecoin. He said of stablecoin proponents:

“But what this view forgets is that what sustains fiat money is not the application of novel technologies but all the institutional arrangements and social conventions behind it.”

They also run the risk of depegging, he added. Stablecoins were developed because they were technically able to do things other forms of money could not. Central banks should take those roles over from them.

Carstens also raised the hackles of the crypto community Feb. 22 with a blunt assessment of the success of cryptocurrency.