IBM Blockchain’s new CTO Stanley Yong speaks with CNBC about CBDCs: “We are quite far along in the discussion about how central bank digital currencies can be used for wholesale purposes.”
Jesse Lund of IBM, Tammy Camp of Stronghold, Jed McCaleb of SDF, and Michael Warner of the Federal Reserve Bank spoke yesterday on a panel at IBM Think 2019. Warner of the Fed asked the panelists how to design a digital currency for the United States, and the panelists estimated when they would expect to see CBDCs issued (1-3 years).
Jesse Lund of IBM talks CBDCs with Pompliano and predicts that a retail CBDC will be issued in the next 1-2 years by a central bank that is not one of the big 5, but pegs its currency to one of the big 5 currencies.
According to a survey of central banks by the Bank for International Settlements, a majority of central banks are researching CBDCs (central bank digital currencies), but "only a few intend to issue a CBDC in the short to medium term." The report focuses in on two countries where the circulating cash supply has decreased - Sweden and Uruguay - and their respective general purpose CBDCs - the e-Krona and the e-Peso.
Note: These are not on the Stellar network.
The Chairwoman of the IMF - Christine Lagarde - made a case for CBDCs at the Singapore Fintech Festival this week, and the IMF released a paper proposing a conceptual framework for assessing CBDC adoption.
“I believe we should consider the possibility to issue digital currency. There may be a role for the state to supply money to the digital economy.”
“This is not science fiction. Various central banks around the world are seriously considering these ideas, including Canada, China, Sweden, and Uruguay. They are embracing change and new thinking—as indeed is the IMF.”
OMFIF - an independent think tank for central banks - and IBM released a report surveying 21 central banks regarding CBDCs. They make a distinction between retail CBDCs, which would “provide all individuals with access to a digital version of central bank fiat money”, and wholesale CBDCs, which would be “limited to financial institutions for interbank settlements.” “No major central bank intends to implement a retail CBDC in the near term. However, the debate about wholesale CBDCs has moved on from questions of feasibility to practical considerations”. Wholesale CBDCs “are certain to be implemented in the future.” Note that this “certainty” is directed at CBDCs in general and not specifically at CBDCs on the Stellar network.