Decred’s co-founder explained how the CBDCs could affect the entire crypto space as numerous countries across the world are racing towards launching their own version of a CBDC. The crypto industry has major selling points to make here even if most countries launch them as Jake Yocom-Piatt commented so let’s find out some more in today’s altcoin news.
Decred’s co-founder continued:
“I expect many nation states will create their own CBDCs in the not-so-distant future, but there is a key differentiator between CBDCs and cryptocurrencies. Cryptocurrencies, e.g. Bitcoin and Decred, are fundamentally fairer systems than fiat currencies, so while CBDCs may adopt many cryptocurrency features, they cannot compete on fairness.”
China is seemingly leading the way in terms of CBDC development while the United States is slowing down. The most recent developments show an increase in sense of importance about these assets as they are most likely to represent a digital version of the countries’ dollars but many details are not known yet. Yocom-Piatt explained that crypto-assets pose a different framework as BTC for example remains untied to the national currencies as it is run by computer codes and miners:
“Based on cryptocurrencies being demonstrably fairer with deterministic issuance schedules and self-custodied assets, I expect them to be relatively unaffected by CBDCs, which are just digital fiat.”
Stablecoins might feel a harder blow from the CBDCs as their main goal is to represent fiat in digital form but the future of stablecoins could still depend on the specifications of central bank digital currencies. He believes that depending on the actions that you want to perform with your CBDCs, stablecoins could become obsolete:
“If there are too many restrictions on CBDC assets, stablecoins may compete on a flexibility front.”
Stablecoins like the ones we know like USDC and USDT work n a blockchain and allow for transactions and storage accommodations. USDC even saw an uptick in the decentralized space back in 2020. As reported earlier, China’s BSN will attempt integrating CBDCs this year and its new project will be focusing on the building of the universal digital payment network and to boost blockchain adoption. China is working out how to make a stronger blockchain adoption rate and it is developing a new project that is aimed at integrating international central bank digital currencies as a part of the BSN.
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Stefan has been writing articles for DCForecasts since 2016 in-house full time. As one of our main cryptocurrency writers, he focuses on covering the latest cryptocurrency news, technical charts, price analyses of coins and press releases. When he is not exploring and covering the latest topics in crypto, you can find Stefan playing basketball, tennis or cycling.
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