Singapore Central Bank MD: Private Cryptocurrencies Will Fade
Singapore’s central bank managing director, Ravi Menon, believes that private cryptocurrencies that do not meet essential financial service tests will eventually disappear from the monetary system. Menon outlined his vision for the future of the monetary system, which includes central bank digital currencies (CBDCs), tokenized bank liabilities, and well-regulated stablecoins.
Private Cryptocurrencies Fail to Retain Value
In a panel discussion on the future of the monetary system, Menon highlighted the shortcomings of private digital coins, stating that they “have miserably failed the test of money because they can’t keep value.” He explained that individuals do not trust these assets with their life savings and see them as tools for quick profit rather than reliable stores of value. Menon predicted that private cryptocurrencies will eventually exit the scene due to their inability to meet essential monetary criteria.
RBI Deputy Governor Optimistic Over CBDC Success
During the same panel discussion, M. Rajeshwar Rao, a deputy governor at the Reserve Bank of India (RBI), expressed optimism about the success of CBDCs. He emphasized the importance of meeting user needs and utilizing existing technology and infrastructure. Rao also highlighted cybersecurity and resilience as critical factors for gaining trust in CBDCs. The RBI is actively exploring offline transactions to enhance CBDC usage and envisions its digital currency facilitating interbank money market transactions. Rao suggested considering implementing CBDCs on a multilateral basis in the future.
Hot Take: Private Cryptocurrencies Face Uncertain Future
Singapore’s central bank chief, Ravi Menon, believes that private cryptocurrencies will fade away due to their inability to retain value and meet essential monetary criteria. He views these assets as tools for quick profit rather than reliable stores of value, leading individuals to not entrust their life savings to them. In contrast, the Reserve Bank of India’s deputy governor, M. Rajeshwar Rao, is optimistic about the success of central bank digital currencies (CBDCs). He highlights the importance of meeting user needs, cybersecurity, and resilience for gaining trust in CBDCs. The RBI envisions its CBDC facilitating interbank money market transactions and explores offline transactions to enhance practicality.
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