CryptoUpdates #4 - Bank for International Settlement - Central bank cryptocurrencies
BIS, the Bank for International Settlement published a report on Cryptocurrencies. These are the main points:
- Interesting key player: first of all is interesting for me to note that a big, financially determinant institution is taking the subject seriously enough to dedicate a paper to it. Cryptos are becoming more and more mainstream
- Central Bank Cryptocurrencies (CBCC): the paper explicitly mentions that many central banks are actively researching the subject and developing applications
- Taxonomy of money: four key properties: issuer (central bank or other); form (electronic or physical); accessibility (universal or limited); and transfer mechanism (centralised or decentralised)
- CBCC money "type": CBCC is an electronic form of central bank money that can be exchanged in a decentralised manner with transactions occuring directly between the parties without intermediary
- 2 possible forms of CBCC: a widely available, consumer-facing payment instrument targeted at retail transactions; and a restricted-access, digital settlement token for wholesale payment applications
- Benefits for Consumers: the peer-to-peer nature has the potential to provide anonymity. Alll other benefits could be achieved by giving the public access to accounts at the central bank (feasible since long time but for now avoided by Ceentral Banks)
- Benefits to Wholesale: improve efficiency and reduce settlement costs. Some central banks have experimented with wholesale CBCCs, but none has announced yet that it is ready to adopt this technology
For more pls see: