Investing.com – The financial world is increasingly recognizing that digital currencies like Bitcoin and Bitcoin have certain advantages that the established banking system cannot provide.
The central banks, which consider themselves the guardians of the currency, do not want to be stripped of their scepter, however. This is why they have been looking into establishing their own digital currencies for some time.
Bank of England partnership with MIT
The Bank of England (BoE) does not want to be outdone and has therefore decided to collaborate with the Massachusetts Institute of Technology (MIT). Over the next twelve months, a concept for a central bank digital currency will be developed in conjunction with the world’s most reputable university of technology.
It is not only a question of determining the most promising technological approach, but also the chances and risks associated with such a project.
The Bank of Canada recently embarked on a similar path, as it also decided to call on the scientific expertise of MIT to come up with a viable concept.
On the European side, the ECB already launched last July the study phase for the development of a digital euro.
However, some countries are using existing blockchain solutions set up by private sector companies. In this sector, the company Labs is at the top of the list. The Republic of Palau and the Royal Monetary Authority of Bhutan are developing a national digital currency based on the XRP ledger (XRPL) with this company.
CBDC undermines Bitcoin and Ethereum payment systems
In 2021, the 87 countries in the world that generate more than 90% of global GDP were already dealing with CBDC solutions. This goes to show that the future of monetary systems will inevitably be digital.
The big goal is full interoperability of global digital currencies. It will also lay the foundations for a digitization of the global economy, thereby facilitating cross-border payments and improving financial inclusion.
Crypto-currencies like and ethereum thus lose one of their advantages. As a digital means of payment, they become almost superfluous. Indeed, why bother with wallets, coins and coins when you can easily access digital versions of the dollar and euro?
This should have significant consequences for the establishment of cryptos in the mainstream.
By Marco Oehrl
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