Three Takeaways from the Digital Currency Conference

Nicholas AnthonyLast week,Currency Research held its inauguralDigital Currency Conference in Washington, D.C. The event brought together experts, policymakers, technologists, central bankers, and stakeholders to discuss the future of digital currencies ––namely, central bank digital currencies (CBDCs). It covered everything from quantum computing to the digital divide in payments.While the event led to too many discussions to list in one sitting, here are three of the key takeaways that seemed to echo throughout the day.A CBDC is a Solution in Search of a ProblemThe most pressing question of all was whether a CBDC was a “shiny new toy” for central bankers or the next great step forward in the history of money. It’s certainly might be a “step in history,” but thecurrent outlook for CBDCs is far from great.Douglas Elliot and Larissa de Lima at Oliver Wyman addressed the issue well last summer when they detailedsix policy mistakes that need to be avoided when crafting CBDCs. One of the most important mistakes they describe might be the mistake of ignoring the other policy tools that are on the table. Luckily, some policymakers appear to be taking note of this warning. For example,Philip Lowe, Governor of the Reserve Bank of Australia (RBA), recently said, “The RBA is open to [the possibility of a CBDC]. To date, though, we have not seen a strong public policy case to move in this direction, especially given Australia ’s efficient, fast,...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs