Here is our pick of the 3 most important Stablecoin news stories during the week.
As this will be the last edition of this weekly summary for 2021, I thought a good place to start would be with these two excellent summaries of where we are with CBDC’s.
Firstly on the Retail side, where consumers hold money directly with the Central Bank.
“While much attention focuses on the retail central bank digital currency (CBDC) ruminations of China, Europe and the United States, smaller jurisdictions are leading the way. For example, Uruguay, the Bahamas, the Eastern Caribbean Central Bank, Nigeria and Jamaica have each launched pilot CBDCs over the past three years.”
CBDCs for the People? Where the Current State of Digital Currency Research Leads (coindesk.com)
Then on the wholesale side, where, as with today’s cash a Bank (Private and/or Public) does the distribution and consumer interface under licence from a Central Bank.
“On December 8, the Bank for International Settlements, the Banque de France (BDF) and the Swiss National Bank announced the completion of Project Jura, which explored cross-border settlement using wholesale central bank digital currencies (wCBDCs). The experiment, in collaboration with private sector firms including Accenture, Credit Suisse, Natixis, R3, SIX Digital Exchange (SDX) and UBS, involved real-value payments and settlements under existing legal and regulatory frameworks.”
The great wholesale digital currency race heats up – Editor’s Blog – (thebanker.com)
We also heard that a large Private sector Bank HSBC with their technology partner IBM tested FX, CBDC settlement.
HSBC and IBM successfully test blockchain-based FX, CBDC settlement capability (finbold.com)
And to finish with, two stories on US regulators coming to grips with why and how they should get involved.
US Financial Stability Oversight Council identifies stablecoins and cryptos as threats to financial system (cointelegraph.com)
Treasury Says New Law Only Way to Fully Contain Stablecoin Risks – Bloomberg
So in summary, 2021 has seen the Crypto Stablecoin market grow at a pace, while besides China the movers in the CBDC space have been smaller countries where maybe the Central Banks does not have so much to lose as their economies are at least partially USD dollarized anyway.
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.
For context on stablecoins please read this introductory interview with Alan “How stablecoins will change our world” and read articles tagged stablecoin in our archives.
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