Central Banks interested in Developing their own Digital Currencies
PRNewsWire published an article regarding a study made by IBM and OMFIF that discusses how many central banks from around the world are keen on developing their own digital currency.
The report encompasses 23 central banks from developed and developing countries. The survey shows that the first central bank digital currency (CBDC) will most likely be issued in the next 5 years.
If left unregulated, digital currencies could harm central banks’ sovereignty and threaten any form of financial stability. Some of the issues that central banks had with the idea of launching their own digital currencies included; the possibility of having private competitors such as Facebook’s Libra, whether or not CBDCs should be available under all circumstances or payment types and the risk of digital bank runs.
“The concept of retail CDBCs has moved rapidly from being the thought experiment of technical experts and philosophers to the subject of boardroom debates focused on tangible, near-term reforms”, said Philip Middleton, OMFIF deputy chairman. “When senior central bankers speculate publicly about the possibility of a universal digital currency, it is a happy endorsement of the reports’ timeliness”.
“Central banks surveyed are interested in positioning themselves to launch their own retail CBDCs, as the findings of this report make clear”, said Saket Sinha, global vice president, IBM Blockchain Financial Services. “Large banks and technology companies will have a major role to play as new public private partnerships are formed to promote interoperability, create services, and extend financial inclusion”.