Digital Currencies Appear Inevitable, According to Bank of America.

According to Bank of America, “digital currencies appear inevitable,” and central bank digital currencies (CBDCs) and stablecoins are “a natural evolution of today’s monetary and payment systems.” The bank anticipates that “private sector beneficiaries will emerge throughout all phases of CBDC implementation.”

Bank of America on Money and Payments in the Future

Earlier this week, the worldwide research team at Bank of America (BOA) released a report on global cryptocurrencies, digital assets, and central bank digital currencies (CBDCs). The bank stated:

Digital currencies appear inevitable. We view distributed ledgers and digital currencies, such as CBDCs and stablecoins, as a natural evolution of today’s monetary and payment systems.

“In our opinion, CBDCs that use distributed ledger technology have the potential to change global financial institutions and may be the most significant technological innovation in the history of money,” said BOA.

According to the research, 114 central banks are now investigating CBDCs, representing 58% of the world’s countries and more than 95% of global GDP. It goes on to say that central bank digital currencies “do not change the meaning of money, but will most likely affect how and when value is transmitted over the next 15 years.”

“CBDC issuances by central banks are inevitable for three reasons,” according to Bank of America. For starters, they “may improve efficiencies in cross-border and domestic payments and transfers.” Furthermore, they “may reduce the risk of central banks losing monetary control” and “promote financial inclusiveness.”

CBDC Development Relies on the Private Sector

According to the Bank of America research, “the private sector is important for CBDC development and issuance,” explaining:

Central banks and governments can’t build new financial systems based on distributed ledger technology alone and have indicated that they will leverage the private sector to drive digital asset innovation. We expect private sector beneficiaries to emerge in all phases of CBDC implementation.

According to the paper, governments may “give contracts to payment and consulting firms in exchange for expertise.”

Bank of America also identified certain risks. “CBDC issuance and adoption may also increase the frequency of bank runs if not properly designed,” the bank cautioned, adding that “during times of stress in the banking system, people may withdraw deposits and exchange them for CBDCs, given that there is no credit or liquidity risk if distributed through the direct and hybrid approaches, increasing financial stability risks.” According to the report’s conclusion:

However, central banks could mitigate this risk by introducing CBDC holding limits, either on a temporary or permanent basis.

For more articles visit : Cryptotechnews24

source

Leave a Reply

Your email address will not be published. Required fields are marked *

  • bitcoinBitcoin (BTC) $ 62,306.00 0.77%
  • ethereumEthereum (ETH) $ 3,430.13 0.66%
  • tetherTether (USDT) $ 1.00 0.03%
  • bnbBNB (BNB) $ 414.43 1.39%
  • solanaSolana (SOL) $ 129.37 1.1%
  • xrpXRP (XRP) $ 0.621039 1.77%
  • staked-etherLido Staked Ether (STETH) $ 3,426.65 0.62%
  • usd-coinUSDC (USDC) $ 1.00 0.01%
  • cardanoCardano (ADA) $ 0.725906 0.3%
  • dogecoinDogecoin (DOGE) $ 0.139492 1.23%
  • avalanche-2Avalanche (AVAX) $ 42.90 1.17%
  • shiba-inuShiba Inu (SHIB) $ 0.000021 6.02%
  • tronTRON (TRX) $ 0.140332 0.33%
  • polkadotPolkadot (DOT) $ 9.22 2.01%
  • chainlinkChainlink (LINK) $ 20.48 3.42%
  • matic-networkPolygon (MATIC) $ 1.07 0.01%
  • wrapped-bitcoinWrapped Bitcoin (WBTC) $ 62,404.00 0.91%
  • uniswapUniswap (UNI) $ 12.59 4.27%
  • bitcoin-cashBitcoin Cash (BCH) $ 468.20 3.27%
  • the-open-networkToncoin (TON) $ 2.64 1.94%
  • litecoinLitecoin (LTC) $ 90.93 0.43%
  • internet-computerInternet Computer (ICP) $ 13.40 3.98%
  • filecoinFilecoin (FIL) $ 10.39 19.49%
  • daiDai (DAI) $ 1.00 0.41%
  • ethereum-classicEthereum Classic (ETC) $ 33.01 1.22%
  • cosmosCosmos Hub (ATOM) $ 11.88 0.42%
  • nearNEAR Protocol (NEAR) $ 4.33 2.67%
  • immutable-xImmutable (IMX) $ 3.26 3.54%
  • leo-tokenLEO Token (LEO) $ 4.77 0.07%
  • blockstackStacks (STX) $ 3.06 5.16%
  • aptosAptos (APT) $ 11.63 3.6%
  • bittensorBittensor (TAO) $ 642.43 0.3%
  • optimismOptimism (OP) $ 3.98 3.56%
  • stellarStellar (XLM) $ 0.134204 0.46%
  • kaspaKaspa (KAS) $ 0.166688 0.37%
  • hedera-hashgraphHedera (HBAR) $ 0.111530 1.39%
  • crypto-com-chainCronos (CRO) $ 0.138441 6.14%
  • injective-protocolInjective (INJ) $ 41.13 3.73%
  • vechainVeChain (VET) $ 0.048750 1.32%
  • okbOKB (OKB) $ 57.70 8.32%
  • first-digital-usdFirst Digital USD (FDUSD) $ 0.999403 0.07%
  • the-graphThe Graph (GRT) $ 0.327694 4.58%
  • lido-daoLido DAO (LDO) $ 3.33 0.79%
  • render-tokenRender (RNDR) $ 7.75 2.65%
  • mantleMantle (MNT) $ 0.898471 0.9%
  • celestiaCelestia (TIA) $ 16.47 0.14%
  • arbitrumArbitrum (ARB) $ 2.07 5.37%
  • moneroMonero (XMR) $ 144.78 1.97%
  • theta-tokenTheta Network (THETA) $ 2.44 19.56%
  • bitcoin-svBitcoin SV (BSV) $ 110.74 4.56%
Translate »