180 ° transformation! The General Manager of the Bank for International Settlements (BIS) believes that the central bank's digital currency may open up new possibilities

Agustin Carstens, general manager of the Bank for International Settlements (BIS), appears to have changed his negative stance on central bank digital currencies (CBDCs) and now says such currencies may open up new possibilities.

blockchain-3277335_1280

Image source: Pixabay

Published on December 5, entitled "The Future of Money and Payment Systems: The Role of Central Banks? In his speech, Carstens studied the central bank's attitudes to emerging technologies to build a more efficient and inclusive financial system.

Wholesale and retail CBDC

Carstens said that the introduction of retail CBDC (available to the public, including businesses and consumers) can also bring significant changes to finance by opening up new possibilities, such as the availability of payment 24/7, to varying degrees Anonymous letters, point-to-point transfers.

He went on to point out that wholesale CBDCs (where the network participants are financial institutions) can be compatible with central bank clearing liquidity regulations. Carstens said wholesale CBDCs will not cause difficult financial footprint issues, as they will be limited to institutions that already use central bank deposits.

Unlike wholesale CBDCs, Carstens outlined that the retail version raises a number of issues, such as appointing entities responsible for enforcing know your customers (KYC) and anti-money laundering regulations.

The negative impact of CBDC on the financial system

Back in late March, Carstens was not so optimistic about the CBDC and advised against issuing such currencies. Carstens then argued that the CBDC could facilitate bank operations and enable people to transfer their funds from commercial banks to central bank accounts faster, thereby disrupting the stability of the system.

At the time, he also pointed out that the central bank's implementation of monetary policy and the stability of traditional markets will have huge operational consequences. "The central bank will not step on the innovative brakes," Carstens said. "But they should not speed up regardless of all traffic conditions."

At the same time, many countries, including China, France and Ghana, are exploring the development of digital national currencies.

We will continue to update Blocking; if you have any questions or suggestions, please contact us!

Share:

Was this article helpful?

93 out of 132 found this helpful

Discover more

Policy

Sam “SBF” Bankman-Fried Faces the Fury of the Court (with a Twist of Humor)

Sam Bankman-Fried, the ex-CEO of FTX, took the stand in a New York court and testified about communication and custom...

Policy

Sam Bankman-Fried's Lawyers Swoop In Pitching for Energetic Jury Instruction Shake-Up!

In a final attempt to secure a not-guilty verdict for their client, the Defense team referenced multiple similar case...

Market

With the entry of big players and the halving narrative, is now the best time to buy Bitcoin?

Using the term "ups and downs" to describe the trend of BTC since June is not an exaggeration, or more precisely, it ...

Blockchain

Demystify Bybit's new product "black technology", you can open both long and short, insurance contracts!

If you have seen Jobs's Apple conference, Rebus' Xiaomi conference, or Lao Luo's wee phone conference....

Blockchain

Babbitt column | Case study: Exchange "downtime", does the holder lose any compensation?

Source of this article: Xiao Sa Author: Tan Hao Guo Xiao Sa The currency circle trading platform advertises that &quo...

Market

South Korean Professor tracking Do Kwon's funds: Signs of Terra's collapse were evident in early 2019

Cryptocurrency fugitive Do Kwon has been on the run from Interpol for several months. A Korean professor has been cl...