The battle to be your stablecoin is on!
Here is our pick of the 3 most important Stablecoin news stories during the week.
This week we saw significant movement on two different visions of what your favourite stable coin should be and who will be running the infrastructure behind it.
First, the ECB fired a shot saying that only a CBDC could be a Stablecoin. All other options were in fact assets. “Stablecoins are pretending to be a coin, but in fact it’s completely associated with an actual currency,” said Christine Lagarde.
Then, a big announcement on the CBDC front. Central banks in Australia, Singapore, Malaysia and South Africa will conduct a cross border payments trial using different central bank digital currencies (CBDC) to assess if this allows transactions to be settled more cheaply and easily.
This latest project aims to develop prototype shared platforms for cross-border transactions using multiple CBDCs, a separate BIS-led project exploring using CBDCs for cross border payments is also underway involving central banks from China, Hong Kong, Thailand and the UAE.
And Finally, Centre, the consortium created by Circle and Coinbase around USD coin (USDC), has assembled a team of new executives to power its expansion overseas. The new team, comprising six new executives assembled by David Puth (ex CEO of CLS, a Bank consortium that runs our current Bank clearing and settlement system), and now CEO of Centre, will look to support new partners and add new alliances to create an interoperable global network of stablecoins. Or put another way, a new Digital CLS.
So in summary, we have led by the BIS, two trials underway to build interoperable CBDC’s that will not need the existing CLS infrastructure and led by Circle, one private sector initiative from the past CEO of CLS to do away with CLS. One way or the other the old financial markets infrastructure is going to be consigned to a museum and that’s a very good thing!
Alan Scott is an expert in the FX market and has been working in the domain of stablecoins for many years.
We have a self imposed constraint of 3 news stories per week because we serve busy senior Fintech leaders who just want succinct and important information.
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