The Deputy Governor of the Central Bank of Japan has said that it was still not certain on how Cryptocurrencies will be able to affect the monetary policies of Central Banks. The Deputy Governor Masayoshi Amamiya added that the Central Bank of Japan was not planning on issuing any Crypto at the moment.
Varying Opinions On the Possibility Of A Central Bank Issued Cryptocurrency
Masayoshi Amamiya stated that although there is a lot of pressure for Crypto to replace fiat currency this will still be a tall order for Crypto seeing that digital currency is mostly just used as a mode of investment and not as a mode of payment for actual products or for settling transactions. However recent developments seem to indicate that this trend may be experiencing a change.
One such development is the announcements made by Ripple, a digital asset used for global payments, about partnering with well-known and distinguished financial institutions including PNC Bank and the Bill and Melinda Gates Foundation. PNC Bank ranks among the top ten banks in the United States and boasts of over eight million customers.
Masayoshi Amamiya’s statement on digital currencies and central banks is not the first instance where a high profile official of a central bank has weighed in on the issue. The head of the European Central Bank, Mario Draghi, also recently made statements that were seen to downplay the possibility of a central bank issuing digital currency stating the main reason for this outlook was the fragility of Blockchain technology which is the underlying technology for Cryptocurrencies. Mario Draghi is arguably one of the most distinguished figures in the world of global finance.
A lot of people within the Crypto space are not exactly surprised that this is the stance taken by many high profile individuals within the banking sector and by the central banks themselves. Many speculate that the main reason central banks seem to be taking this stance against Cryptocurrency is that it has the potential of disrupting the whole global settlement and payment system and is, therefore, a real threat to the operations of central banks.
Just recently Elvira Nabiullina, who is the head of the Central Bank of Russia, stated that the interest that was initially being experienced in the nation’s Crypto sector was declining. In the same breath, she acknowledged the effectiveness of ICOs (Initial Coin Offerings) as a means of raising funds and also pointed out that the sector was prone to scams.
Even with these discouraging statements being made by respected figures in the financial sector, there are still many other organizations that have expressed a contrary opinion. The World Trade Organization has recently published a report that seems to praise the potential that comes with digital assets.
Digital Currencies For Global Commerce
The report stated that Blockchain has the potential of completely overhauling how we trade, what we trade in and the people that complete the trades. The report which was mainly focusing on how digital technology was affecting the global commerce specifically centered on Ripple when discussing the potential of digital currencies in the global payments sector.