Central bank digital currencies will complement cryptocurrencies rather than competing with them despite not being structurally different from their country’s fiat currencies, strategists and fund managers said.
Around 90 percent of the world’s central banks are now working on their own digital currencies unlike traditional ones like Bitcoin, some of which may be issued in the next three years, a January survey from the Bank for International Settlements showed. Bitcoin price in India stood at 28.7 lakhs as of 5:30pm IST on June 16.
Central bank digital currencies (CBDCs) “are structurally no different than fiat, and they are very much complementary to cryptocurrency, not competitive,” Meltem Demirors, chief strategy officer at CoinShares, Europe’s largest digital asset investment firm managing $5 billion (roughly Rs. 36,660 crores).
The interview was part of a series on digital currencies run on the Reuters Global Markets Forum over the past week.
Kevin Kelly, head of global macro strategy at digital asset research firm Delphi Digital, said he expected CBDCs to improve traditional monetary systems via easier transmission of fiscal policy, while aiding crypto markets by bridging the gap between fiat and decentralized finance (DeFi).
CBDCs will likely provide the preferred means for making digital payments without killing existing tokens, said Vytautas Zabulis, managing director at digital asset trading solutions company H-Finance.
“I see this as a cleaning up of all the ones…