As it stands, with interest in Central Bank Digital Currencies growing steadily across the globe with the proliferation of blockchain technology, nations are starting to push for their own digital version of their currency.
The current leader appears to be China with its own People’s Bank of China cryptocurrency, slowly coming to fruition according to whispers in the east. However, China is not the only one looking at their versions of a digital currency.
Recent news has seen some smaller nations, such as the British Virgin Islands, launching a stablecoin designed with the intention of providing “Rapid Cash” in case of an “emergency,” while also providing an alternate method of payment within the nation.
While all this is going on, the US, which has a suspicious approach to cryptocurrency, at best, has also been toying with the idea of launching their own cryptocurrency. Even though there are inclinations of the US Fed, taking into consideration a digital dollar, it does not look like the US will be a winner in this race.
China has identified that the launch of a state-backed cryptocurrency can help tear it away from the US Dollar hegemony, and this could be part of its push to take the lead as a world superpower in the coming years, based on technology.
In fact, the US Secretary of the Treasury Steven Mnuchi has mentioned that he and Federal Reserve Chairman Jerome Powell do not anticipate the development of a national digital currency in the country.
“Chair Powell and I have discussed this — we both agree that in the near future, in the next five years, we see no need for the Fed to issue a digital currency,” Mnuchin said.
The explanation offered up by Mnuchi is in response to an ongoing battle against Facebook’s digital currency Libra. The US has taken a harsh line against the private digital currency, and could be one thing blinding their view on what can be done with such a cryptocurrency.
It already appears as if the US will not be the leader in the blockchain space as China has again pushed forward there. More so, with the identification of blockchain being a powerful nascent technology is the understanding of its financial firepower too.
If the US does not see the need to join this race as yet, it will be interesting to see what happens when China’s currency does get up and running.