Categories: Regulation News

World Central Banks at G20 Summit 2018: State Backed Cryptocurrencies Or A Global Cryptocurrency?

Today’s the first day of much anticipated G20 Summit 2018 that is bringing together the central bank governors and finance ministers. With the rise in…

advertisement

Today’s the first day of much anticipated G20 Summit 2018 that is bringing together the central bank governors and finance ministers. With the rise in the state-backed digital currencies globally, this meeting might bring us closer to the fate of this popular phenomena.

Advertisement

Are State backed cryptocurrencies the future of money?

On the first day of the G20 Summit, the finance ministers and central bank governors are going to come together. With cryptocurrencies being center of attraction and given the central bank’s tilt towards developing their own digital currencies, this will certainly be the point of discussion.

Central Banks are increasingly shifting towards cryptocurrencies, however going by the report of the Bank for International Settlements (BIS), these state-backed cryptos negatively impacts the financial system and can lead to cross-border panics which is just an effort on central banks’ part to destroy the outside competition.

Not to mention, different banks having their own digital currency can be hard to monitor, control and regulate.

So, the question that arises here is if the G20 Summit 2018 meeting would facilitate the state-backed digital currency or would rather opt for global cryptocurrencies?

Advertisement

Also, read: US Congress Economic Report Talks Cryptocurrency And Blockchain Potential

Central banks to watch Out for state-backed cryptos in G20 summit 2018

Out of 20 nations that are part of this summit, the majority of them are either interested in the state-backed digital currency, undergoing the development process or have already announced their plans. A number of these countries need to be watched out on the first day of G20 summit 2018.

When it comes to European Central Bank, it has repeatedly warned about the dangers of investing in cryptocurrency. In November though, the President of ECB, Mario Draghi stated that the impact of these virtual currencies on the economy is limited. Given ECB’s stance on digital currencies, it is most likely that this bank won’t be in favor of nations developing their own currencies.

  • India’s Reserve Bank of India (RBI) has always been opposed to the cryptocurrencies, however, it has created a committee to study about state-backed digital currency and its potential use and benefits.
  • Japan’s central Bank FinTech Center has no interest in creating their own cryptocurrency as it believes through the cashless transaction is on the rise, there is no demand for a digital currency yet.
  • The governor of Bank of England Mark Carney sees cryptocurrencies as something that has the potential to bring revolution in the finance industry but it is a long way from developing sterling’s digital version.
  • In the US, cryptocurrencies are still in its early days of investigation by Federal Reserve System and authorities believe that there are challenges like privacy in state-backed digital currency.
  • The Central Bank of Russia has expressed concern over the digital currency and believes that Putin commissioned CryptoRuble, which basically violates the law doesn’t have the demand.
  • China has cracked down hard on cryptocurrencies but the country’s central bank, People’s Bank of China is already running the prototypes for its own digital currency.

All that being explained, the BIS says the growth of cryptocurrencies can’t be ignored but cryptocurrencies by central banks pose stability risk. It would be interesting to watch the kind of points the meeting will put across and the subsequent decision to be achieved.

What are your thoughts on state-backed cryptocurrency discussion in G20 summit 2018? What do you think the probable outcome of the meeting would incline towards? Share your thoughts with us!

To get the daily price analysis, Follow us on TradingView

Achal Arya

I am an entrepreneur and a writer with a bachelors degree in Computer Science. I manage the blockchain technology and crypto coverages at Coingape. follow me on Twitter at @arya_achal or reach out to me at achal[at]coingape.com.

Recent Posts

ETH Supply in Smart Contracts Leads That on Exchanges With Huge Margin, Thanks to DeFi

On-chain data analytics provider Galssnode has come up with an interesting observation for ETH supply!…

1 day ago

DeFi Mania Continues to Catalyze DEX’s Volume

Decentralized exchanges [DEXs] has recorded phenomenal growth in 2020. And it is not the user…

2 days ago

CrossFi Solutions Can Overcome the DeFi Hype in Building a Sustainable Future for Decentralized Finance

Decentralized Finance (DeFi) is no-brainer the crypto ‘buzzword’ of 2020, this space has experienced tremendous…

2 days ago

Security Risks in DeFi (Decentralized Finance)

Decentralized finance has been the talk of the town for the last few months, seeing…

2 days ago

Bitcoin Trading Volume on Bakkt Peaks Again as September Expiration Approaches

Bakkt recently had witnessed a peak in the trading volume of physically-settled bitcoin futures on…

2 days ago

Bitcoin To 10x From These Levels Says Analyst, Predicts Other Giants to Follow MicroStrategy

Business Intelligence Firm MicroStrategy created a massive buzz by announcing BTC purchase worth $425 million.…

2 days ago