фото показано с : blokt.com

The winds of change are sweeping the financial sector, at least according to Christine Lagarde, the managing director of the International Monetary Fund (IMF).

Speaking at the Singapore Fintech Festival on Nov. 14th, Lagarde urged central banks to consider issuing a digital currency to fill a void created by the decrease in demand for cash. She spoke about the “changing nature of money and the fintech revolution” and how digital currencies will play a big role in financial inclusion.

Lagarde said that the switch to digital currencies should not be difficult because:

“Deposits in commercial banks are already digital.”

Digital currencies are not science fiction as “various central banks around the world are seriously considering these ideas, including Canada, China, Sweden, and Uruguay. They are embracing change and new thinking—as indeed is the IMF.”

Several countries in the world have already issued government-backed cryptocurrencies but mostly due to the collapse of their fiat currencies.

The IMF has released a paper that discusses the pros and cons of central bank digital currencies. The paper focuses on the domestic effects. Lagarde says that the central bank-issued cryptocurrencies would serve several purposes including:

“(i) financial inclusion, and (ii) security and consumer protection; and to provide what the private sector cannot: (iii) privacy in payments.”

She said that digital currencies have the potential to reach people and businesses in remote and marginalized areas and on the other hand, “banks are not exactly rushing to serve poor and rural populations.” If digital currencies are adopted, the demand for cash will decrease.

The introduction of digital currencies would help with security and consumer protection. Lagarde said:

“A digital currency could offer advantages, as a backup means of payment. And it could boost competition by offering a low-cost and efficient alternative—as did its grandfather, the old reliable paper note.

The IMF chief pointed out that another advantage of a digital currency is privacy and anonymity. She said that central banks would not issue “fully anonymous digital currencies” because doing so would be a “bonanza for criminals.”

There are risks associated with bank digital currencies, but another major risk is stifling innovation. There has to be a tradeoff between financial integrity and privacy.

Banks need to design digital currencies that authenticate users in the background but their identities “would not be disclosed to third parties or governments unless required by law.”

If there is any suspicion of money laundering and finance terrorism, the veil of anonymity would be lifted, and authorities will step in to investigate.

With relation to financial stability “digital currencies could exacerbate the pressure on bank deposits.”

Lagarde highlighted the risk of stifling innovation. She asked what would happen if “the central bank offers a full-service solution, from digital wallet, to token, to backend settlement services.”

IMF Head: Central Banks Should Consider Issuing Digital Form of Money was originally found on [blokt] - Blockchain, Bitcoin & Cryptocurrency News.

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