CBDC and Cryptocurrencies are NOT the same

As millions of people start to take an interest in the world of crypto, it is important to understand the difference between a Central Bank Digital Currency (CBDC) and a Cryptocurrency like Bitcoin.

The growth of cryptocurrencies like Bitcoin and Ethereum has led to a greater interest in the technology behind these currencies from startups, individuals and governments alike.

There are many pros and cons to the CBDC economy. Jumping to conclusions based on incomplete understanding of the CBDC world is rife, especially since misinformation abounds and not much has been made public about the launch of the CBDCs by some of the economic giants in the world. 

Find out what these differences are in Arti Agarwal's article "Why CBDCs Are NOT The Same as Cryptocurrencies Like Bitcoin" HERE.

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Is the rush to CBDCs just a fad driven by FOMO?

U.S. Federal Reserve Vice Chair for Supervision Randal K. Quarles called the global rush to roll out central bank digital currencies (CBDC) akin to the 1980s parachute pants fad and FOMO, or the “fear of missing out.”

He was speaking at  the 113th Annual Utah Bankers Association Convention, Sun Valley, Idaho.

He drew a parallel to the world’s knee-jerk infatuation with digital currencies.

“Before we get carried away with the novelty, I think we need to subject the promises of a CBDC to a careful critical analysis,” he said in his remarks.

You can read his full speech "Parachute Pants and Central Bank Money" HERE.

Other comments from PYMNTS.com HERE.

CBDCs and the opportunities for the monetary system

Central bank digital currencies (CBDCs) offer in digital form the unique advantages of central bank money: settlement finality, liquidity and integrity. CBDCs are an advanced representation of money for the digital age and the digital economy.

Digital money should be designed with the public interest in mind. Like the latest generation of instant retail payment systems, retail CBDCs could ensure open payment platforms and a competitive level playing field that is conducive to innovation.

The BIS, in its Annual Report, to be published later today, has a full chapter on central bank digital currencies. Read the full chapter HERE.

 

Fintechs focus on cross-border business payments

Nonbank fintechs are gaining ground, mainly with small company customers, but target larger ones for cross-border business, even as competition gives way to symbiotic 'coopetition' with larger banks.

Consumers move funds to their friends through Venmo and Zelle with relative ease and low costs, but cross-border payments — particularly for businesses — are significantly more costly. 

Fintechs are attacking cross-border business payments as banks and legacy players join the rush to innovate

Read more HERE. 

 

5 ways blockchain can change the cross-border payments landscape

'Cross-border payments is a changing sector of the industry, driven by customers demanding little to no friction and encountering multiple steps, intermediaries and fees. Every step along the path of a cross-border transaction requires time and money, with the average cost of remittances sitting at 7%, according to a 2018 World Bank report. The industry has reacted through the creation of new faster payment initiatives, aimed at reducing delays in payments and standardising intermediary fees. Others have turned to distributed ledger technology (DLT) and blockchain as potential cure-alls for cross-border pain points.'

Read the rest of Alex Hamilton's insighful article HERE.

The A, B, Cs of Payments 2015

From PYMNTS.com –

“Well, here we are – just a few short weeks before 2015 is one for the history books. What a year it’s been.

In many ways, 2015 was the year in which everything – and nothing — about payments changed. Plastic cards, checks – and yes, even cash – still define how payments are made among people and businesses. This is despite the billions of dollars and manhours dedicated to launching a seemingly endless array of new innovations intended to change that.

That’s why 2015 might be one of the most important years in payments and commerce history yet. It was a year in which important lessons were learned about what the future of payments might look like, where we got a better sense of what real problems need to be solved and for whom, what enabling technologies might help us do that, and who might lead the way.”

Read more>>