Accoridng to the latest reports, it seems that a new experiment shows central bank digital currency (CBDC) can work with private stablecoins. It’s been revealed that this can happen even if intermediary operators go bust, the Hong Kong Monetary Authority said Friday.
Just to refresh your memory, private stablecoins are designed to maintain stable values relative to a reference currency like the U.S. dollar or an asset like gold. On the other hand, CBDCs are digital versions of sovereign currencies.
The online publication CoinDesk notes the following:
“Project Aurum – named after the Latin word for gold – shows CBDC used by retail customers can be private and flexible, said its architects, who also include the Bank for International Settlements Innovation Hub and a research institute.”
“Project Aurum has made a number of ground-breaking achievements,” said the study.
The same notes revealed:
“We have no doubt that the Aurum prototype will catalyze and inspire the global quest for the most suitable rCBDC [retail CBDC] architecture.”
Federal Reserve Governor Talks About The Utility Of A US CBDC
Not too long ago, we were revealing that the federal reserve governor addressed the utility of a US CBDC these days.
He doesn’t seem to be convinced it is worth it for the US to develop a central bank digital currency (CBDC).
Christopher J. Waller, who is one of the seven members of the Fed’s Board of Governors, stated not too long ago in a new speech at a Harvard National Security Journal symposium that he believes developing a CBDC will have little impact on securing the long-term dominance of the US dollar.
“Advocates for a CBDC tend to promote the potential for a CBDC to reduce payment frictions by lowering transaction costs, enabling faster settlement speeds, and providing a better user experience.”
He continued and said this:
“I am highly skeptical that a CBDC on its own could sufficiently reduce the traditional payment frictions to prevent things like fraud, theft, money laundering, or the financing of terrorism.”