Towards a global currency

Across many lands, central banks are
exploring or studying the feasibility of launching central bank digital
currencies (CBDCs). It has dawned on many experts in the field of central
banking that the blockchain and cryptocurrencies are inevitable innovations.

Privately issued Bitcoin has already demonstrated that digital currencies or cryptocurrencies have a place in today’s financial and payments markets, and unless they reform, central banks risk being driven out.It therefore seems logical for central banks to join in this mad rush to create digital alternatives to fiat money.

CBDC gaining momentum

While the momentum towards digital currencies grows, questions are being raised now about just how CBDC are going to be deployed, their design or if these are ever going tobe interoperable with privately issued digital currencies.

However, there seems to be somepressing issues that need tackling before CBDCs overtake fiat cash. Such issues seem not to be getting enough attention.

Questions on what will determine the value of CBDCs issued by central banks need to be answered well before any talk of rolling out the digital tokens.

For CBDCs to work smoothly and be interoperable, therehas to be a common denominator or basis that allows any such seamless movement of funds between different networks.Using a common base eliminates the uncertainty and chaos that presently besets the private currency space.

Now some influential figures have suggested using existing public blockchain networks like Stellar or Ethereum as a rail on which CBDCs will run on.

This approach eliminates the need to