The ongoing World Economic Forum at Davos is a meeting place of the big names of the world. This year, crypto and blockchain businesses have a lot at stake after a year full of turbulence. Several scams and collapses have hit the trust factor. An unlikely competition has now emerged in the form of CBDCs or central bank currencies.
India has piloted its bitcoin killer in December. And several countries around the world are in concept or pilot stages. The CBDC will be like a national currency, reigns held by the central bank, and regulated by policy rather than free market action.
The Bitcoin blockchain, the only free market money right now under nobody’s supervision, has shown signs of life as it jumped back into the $20k range. Its energy guzzling nature has been the biggest drawback so far (even though more than half of it is green, sustainable energy.)
At Davos, CBDCs are in focus. For the elite here, the future of money is not bitcoin, but CBDCs, as per a report in Coinmarketcap, mentioning Bank of America, IBM and Deloitte. A 7-point document has been prepared by Euro finance ministers that contains the features of a digital Euro they would want to see.
- For Bank of England, the clarity over what problems a CBDC would solve is important before going along with the rush.
- A report writer from Bank of America calls CBDC important to avoid becoming irrelevant in the long run.
- Someone from Deloitte said contract-programmable money like CBDC and stable coins were the direction to go.
- The Eurogroup statement puts a heavy focus on privacy and trust, just like cash, along with anti-money laundering and measures against tax evasion or illicit use.
Ukraine’s deputy PM would like to become the first test user of their CBDC and will accept his salary in e-hryvnia. E-hryvnnia is the proposed and patented digital currency of Ukraine’s central bank in collaboration with the Stellar blockchain – https://bank.gov.ua/en/payments/e-hryvnia
Stable coins sit between the super-volatile popular cryptos and CBDC. They are private money, but pegged to the dollar or some precious asset like gold. However, the sound of Terra’s crash is still resounding in the market.
Bitcoin has stirred a huge hornet’s nest for sure.
The World Economic Forum has its critics too:
WEF is increasingly becoming an unelected world government that the people never asked for and don’t want
— Elon Musk (@elonmusk) January 18, 2023
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