New York Fed Advisor: Stablecoins May Be Better Than CBDCs For Central Banks
According to a New York Federal Reserve advisor speaking at a London event on Tuesday, stablecoins may provide central banks with a faster route to creating their own digital currency.
A new direction for Central Bank Digital Currency (CBDC) has been revealed by research on the future of digital currencies by Antoine Martin of the Federal Reserve Bank of New York. Central banks could encourage the creation of secure stablecoins rather than investing more money and resources into creating their own digital currency, according to Martin. The financial research advisor stated:
“Stablecoins are much better payment instruments than Bitcoin and stabalise their value by being backed by assets denominated in a fiat currency. They commonly depend on commercial bank money to hold the reserve assets that back their coin representations and this is typically the US dollar.”
Lord Chris Holmes, Vice-Chair of the All-Party Parliamentary Group on FinTech, House of Lords, and Sir Jon Cunliffe, Deputy Governor of the Bank of England, both presented at the conference, which was themed “DeFi & Digital Currencies: The Challenges & Opportunities for Policy Makers.” While the Bank of Canada and the Bank of International Settlements also made presentations.
“Instead of issuing a retail CBDC, central banks could support stablecoins by allowing them to be backed one-for-one with balances in a central bank account. They could also facilitate a bankruptcy remote legal structure to ensure that end-users are paid in full even if the issuer becomes bankrupt,” added Martin.
While the Federal Reserve has previously stated a slower, more deliberate approach to creating a digital dollar, the New York Fed recently launched a pilot regulated liability network for private banks to test out digital liabilities.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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Harold
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New York Fed Advisor: Stablecoins May Be Better Than CBDCs For Central Banks
According to a New York Federal Reserve advisor speaking at a London event on Tuesday, stablecoins may provide central banks with a faster route to creating their own digital currency.
A new direction for Central Bank Digital Currency (CBDC) has been revealed by research on the future of digital currencies by Antoine Martin of the Federal Reserve Bank of New York. Central banks could encourage the creation of secure stablecoins rather than investing more money and resources into creating their own digital currency, according to Martin. The financial research advisor stated:
“Stablecoins are much better payment instruments than Bitcoin and stabalise their value by being backed by assets denominated in a fiat currency. They commonly depend on commercial bank money to hold the reserve assets that back their coin representations and this is typically the US dollar.”
Lord Chris Holmes, Vice-Chair of the All-Party Parliamentary Group on FinTech, House of Lords, and Sir Jon Cunliffe, Deputy Governor of the Bank of England, both presented at the conference, which was themed “DeFi & Digital Currencies: The Challenges & Opportunities for Policy Makers.” While the Bank of Canada and the Bank of International Settlements also made presentations.
“Instead of issuing a retail CBDC, central banks could support stablecoins by allowing them to be backed one-for-one with balances in a central bank account. They could also facilitate a bankruptcy remote legal structure to ensure that end-users are paid in full even if the issuer becomes bankrupt,” added Martin.
While the Federal Reserve has previously stated a slower, more deliberate approach to creating a digital dollar, the New York Fed recently launched a pilot regulated liability network for private banks to test out digital liabilities.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Website: coincu.com
Harold
Coincu News
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