There is growing interest across the world and with some of the world’s biggest central banks about the power and potential of Central Bank Digital Currencies. The idea of issuing fiat currency through the central banks, but on a blockchain in a similar manner to Bitocin is seen as the next evolution of finance.
This is not only being noted by the governments and their central banks, as well as the cryptocurrency community as a whole, but also by some of the bigger players in the payments space — such as Visa.
The fact that CBDCs are being looked into and explored is seen as a big step for Cuy Sheffield, who runs credit card giant Visa’s crypto projects. He sees this as a big step for the future of money and payments, but thus of course is a big move for cryptocurrencies as well.
“I’d argue that central bank digital currency (CBDC) is one of the most important trends for the future of money and payments over the next decade,” he Tweeted
“Regardless of anyone’s personal views of whether it’s good or bad, the reality is that global interest in it is not going away.”
Shaping the future
What makes the exploration of CBDCs so interesting, especially for those who are more cryptocurrency-orientated, is that the path laid out by the central banks in using this new technology is still to be defined. There is no way a CBDC will be very close in nature to Bitcoin, but it may be traceable back to that first major cryptocurrency
“As governments evaluate CBDC, the path that they decide to take will have major implications for privacy, monetary sovereignty, geopolitics, and financial inclusion, as well as global adoption of crypto dollars and Bitcoin. Therefore, if you are interested in any of the above, it’s worth closely following the active debate around if CBDCs should be created and how specifically they should be designed and implemented,” Sheffield added.
The future is also being shaped rather quickly as while there is no full CBDC launched as many think it should be, there are countries getting close, and projects and pilots proving a lot. There is the Chinese CBDC that many would argue is the furthest along and potentially the one that will have the largest impact, but most of the leading nations are somewhere along this path.