Speaking at the Singapore FinTech Festival, Standard Chartered CEO Bill Winters discussed digital currencies, particularly central bank digital currencies (CBDC), and argued that their widespread creation and mass adoption was absolutely inevitable.
A scope for both private and state-backed electronic currencies
Winters pointed out that both governmental and private entities could propel the extensive rollout of cryptocurrencies. He stated:
“I think there is absolutely a role for central bank digital currencies (CBDC) as well as non-central bank-sponsored digital currencies.”
The StanChart CEO affirmed that the digital currency scope was broad because it could accommodate both state-backed and private ones. China is already setting the ball rolling with the public trials of its digital yuan aimed at testing various features like offline payment and touch to pay functions.
Private entities like Facebook have shown their interest in the cryptocurrency space. For instance, it recently rebranded the Libra project to Diem ahead of its dollar-backed stablecoin launch.
“The really interesting development for me is to have currencies that don’t match a currency in and of itself, but are intended to capture either a superset of a subset.”
Winters suggested that the emergence of tailor-made digital currencies could be witnessed. For instance, cryptos needed to trade in the voluntary carbon market, which could prompt users to offset their carbon emissions. He acknowledged:
“Those sorts of applications for a digital currency, and creating a digital currency ecosystem, is something that can’t be replicated by a fiat currency, or, most likely, by a central bank digital currency any time soon.”
Global central banks are ramping up central bank digital currency (CBDC) research because they see them as game-changers in easing domestic and international payments, given that transfers will be channeled through the internet and possibly even offline. Recently, the Swiss central hailed the trial of its CBDC a success.
On the other hand, Christine Lagarde, the ECB president, said in a statement on Nov 30 that stablecoins could threaten monetary sovereignty and financial stability.
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