The opinion of the future of cryptocurrency remains divided and dogmatic. The protagonists see it transforming the global payment system. Skeptics see it as a solution looking for a problem.
Let Bitcoin as a payment vehicle on one side. He clearly found a substantial niche in terms of restoration for the payment requirements of drug gangs, smugglers, crooks, kidnappers, evaders of tax controls and capital, and money launders – in short, it is the system of payment of choice for very illegal economic substantial, replacing the bulky ineffectiveness. But for daily transactions and transfers, Bitcoin does not provide a useful payment function, at national or international level.
The existing range of Stablecoins does not seem to the height of the task.
It was suggested, including on The interpreterthat stablecoins could provide the crypto -based payment solution. Stablecoins are digital currency With a fixed value compared to a conventional currency (generally the US dollar), in theory supported by conventional assets such as government securities.
The existing range of Stablecoins does not seem to the height of the task. Their value, in stable theory, is not guaranteed. Terra and Luna has lost most of their value, and even the largest stablecoin – the attachment – was sentenced to a fine for false statements on his support. For those who are delicate on their associations, stablecoins have the same harmful potential of use as Bitcoin. The attachment was the vehicle for a huge British silver laundry scheme And his supporters praise his privacy and his ability to avoid regulations.
While the stablecoins are currently bypassing the requirements of the connoisseur client and the anti-money money laundering, the authorities will have to either give up these requirements (which is unlikely), or apply them to the mounted cybero, which would remove their main attraction of anonymity.
President Trump Genius can possibly Solving these problems, with regulations to combat money laundering and other illicit activities. Stablecoins can be issued by institutions with undeniable integrity: for example, JP Morgan plans to publish one.
If these problems are solved, stablecoins may seem to have advantages over the international banking payment system. The banking system is indeed very complicated. It implies several links: Swift Intermediates A secure transfer message (it is not, itself, a payment system); The sending bank must have a corresponding bank trust in the foreign country; Then, there is a exchange rate transaction, which in turn will require a bidirectional transaction via the US dollar to convert by using foreign exchange markets in the United States and Fedwire / Chips payment systems; And then the usual infrastructure of interior payments ends the transaction by passing the money from the bank corresponding to the beneficiary’s bank. All this complexity has a cost. As banks were, until recent years, the only way to make these transfers safely, there was also a heavy monopoly sample. Large customers have obtained better prices, but small transfers – workers’ funds – have paid exorbitantly.
Stablecoins could bypass part of this complexity. If the recipient had a portfolio for the same stablecoin as the sender, the stablecoins could be purchased and the transfer would be simple and secure. The coupling is that the recipient should always convert the scheme to the local currency before being able to make a purchase. That Exchange a Stablecoin JP Morgan for the local currency (and what commission will they invite)?
When crypto could potentially find a useful payment role, it is the form of a digital currency from the central bank.
While crypto promoters are trying to find an answer to this exchange problem, the banking system has taken note of emerging alternatives. What do monopolists do when confronted with competition? They learn to compete. In recent years, commercial banks and other traditional payment systems have given much better exchange rates than before. For example, Wise will perform a payment transaction quickly and with a favorable exchange rate, without going through stablecoin links.
In short, stablecoins can have other uses (maybe as programmable currency to facilitate commercial transactions), but are not competitive for international transfers.
When crypto could potentially find a useful payment role, it is the form of a digital currency of the central bank (CBDC). The digital currency of central banks is already the key element of the national payment system. A CBDC could be used in international transactions to bypass Swift and the need for a foreign corresponding bank. Some central banks are already Experience with CBDC to make international transfers to foreign central banksBut no central bank would allow its CBDC to be held by the general public, as it would present A major threat to the stability of the conventional banking system.
America is, unsurprisingly, Do not rush to support an innovation This could undermine the global role of the dollar. The Engineering Act specifically prohibits the American Federal Reserve from developing a CBDC. Without an American CBDC, it is difficult to see how a global payment system based on CBDC could compete with existing arrangements.
