On April 3rd, 2020, The Deutsche Bank tweeted that The COVID-19 pandemic is accelerating the rise of central bank digital currencies (CBDCs) as many governments see the handling of cash as a potential risk factor.
This echoes the thoughts of the World Health organization, who believe that Banknotes may be spreading the new coronavirus, so people should try to use contactless payments instead.
Similarly, the Bank of Ireland announced that it was waiving its contactless fees.
John O’Beirne, director of products at the bank, said that:
“Contactless transactions are the safest and most practical solution for customers in the current climate.”
Digital currencies such as Bitcoin could come in handy at this time. Rather than have to use notes or cards, users can pay for your services using digital money. These cryptocurrencies help reduce human interaction and could thus halt the spread of the virus.
One of the most popular digital assets is Central Bank Digital Currencies (CBDCs), and many central banks globally are already in testing for their CBDCs, with the French central bank being the latest to announce its testing phase.
CBDCs essentially behave similarly to cryptocurrencies like BTC but are backed by the central government of a nation and are issued and regulated by the central bank. In the wake of the Corona outbreak, governments should perhaps consider developing their CBDCs much earlier than they anticipated.
Covid-19 Could Foster Digital Assets Adoption, Are CBDCs The Way To Go?
Since the Covid-19 outbreak reached a tumultuous phase over the last week and social distancing became the norm, business startups have been looking at ways of reducing physical contact.
Consequently, Central banks in a growing number of countries are taking actions to encourage contactless payments as the coronavirus pandemic escalates. The moves come as governments worldwide seek to encourage ‘physical distancing’ and heighten awareness of the germ-carrying properties of inanimate objects such as paper money and coins.
For instance, The Bank of England has acknowledged that banknotes “can carry bacteria or viruses” and urged people to wash their hands regularly. The directive comes after both China and Korea last month began disinfecting and isolating used banknotes as part of their efforts to stop the spread of the virus.
To prevent the spread of the disease, people should use contactless technology where possible, and many in the crypto space see this as an opportunity to champion the use of cryptocurrencies on a larger scale globally.
Ripple’s Partner, MasterCard Enables Higher Contactless Payments
In related news, MasterCard revealed on April 2nd that it is facilitating the escalation of contactless payments in Canada, as more folks look for safer ways to make payments during the ongoing pandemic.
Interestingly, MasterCard has announced similar measures to champion contactless limit raises globally, as a growing number of startups encourage customers to pay via contactless means.
These recent announcements are remarkable for many in the crypto sphere, as the payments firm has recently been channeling its energy on creating a “wallet solution” for cryptocurrency.
This implies that MasterCard could be pushing for more contactless payment options in crypto, which would be a massive boost for adoption globally, especially in the wake of the coronavirus.