"The US continues to study a digital dollar while others are making progress. "Whomever sets up large international payment systems first will have a de-facto standard, one which latecomers will have to adopt," he said. It matters which nation's digital currency achieves widespread adoption first because that government will be able to set the global rules for most others, according to Steinberg. Australia, China, Thailand, Brazil, India, South Korea and Russia already have pilots or will begin test programs this year. By 2030, the Bank of England and UK Treasury are planning to launch a digital pound or ‘Britcoin' CBDC. The US has been a slow follower compared to other nations, such as China and its digital Yuan, in developing a CBDC. In places such as China, where spending activity is closely monitored, that would let the government know what movies an individual is buying tickets for of whether they are spending money at a bar. A government can adjust everything from the money supply to interest rates as they manage and maintain the value of a fiat currency."ĭigital currencies also eliminate the anonymous nature of consumer cash transactions. "Unlike cryptocurrencies such as bitcoin, a currency that is backed by the full faith and credit of the United States or other trusted government would provide certainty that the value of the currency is being carefully managed. "It would simplify and speed up cross-border payments and reduce the cost and complexity of processing checks, wires, etc.," Steinberg said in an email reply to Computerworld. Businesses would also be able to make cross-border payments for goods and services with much cheaper, and faster, settlements.Ĭentral-bank-backed digital currencies would also reduce the costs of printing and replacing mone, help improve fraud detection, and allow money paid to scammers to be more easily traced and recovered, according to Lou Steinberg, former Ameritrade CTO and managing partner at cybersecurity research firm CTM Insights. With a cross-border CBDC payment system, immigrants, for example, could send money back to their countries of origin without having to pay what can be exorbitant fees for electronic money transfers.
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