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תאריך: אפריל 29, 2022 | קטגוריות: קידום אתרים

As technology continues to revolutionize the way of the way we spend, live, and save, central banks around all over the world are working to rethink their currency to be more digital in their approach. The United States is the latest country to announce "urgency," in its search for a digital copy of its currency through CBDC, also known as a Central Bank Digital Currency or CBDC.

A part of President Joe Biden's executive Order on digital assets, it was released on Wednesday. It mentions "placing the highest priority on research and development a potential United States CBDC. Should the issuance be considered to be in the national interests," according an factsheet issued by the White House.
China, the second-largest country in terms of gross domestic product in the world launched the digital renminbi in January. The CBDC boasts over a hundred millions of users. Around 100 countries are considering CBDCs on one level or another, International Monetary Fund managing director Kristalina Georgieva told a panel at the Atlantic Council think tank last month.
Georgieva declared that "we have moved beyond discussions about CBDCs as concepts, and we are now entering the process of experimentation." "Central banks are getting their hands dirty and gaining a better understanding of the bits and bytes that make up digital money."
CNN Business interviewed David Yermack, New York University's finance department chair. cardano price said it was "inevitable that everyone in the world's nations will be releasing this money." The pandemic in the United States prompted demand for cashless payment methods. A lot of Main Street investors have adopted cryptocurrencies such as bitcoin and ethereum, which has placed pressure on the authorities to stay on top of the rapid growth.
The Biden administration is now putting greater emphasis on innovation and American money. Here's the information on an upcoming CBDC.
What is the Central Bank Digital Currency? And how does it work?
CBDCs are a form of digital representation of central bank money which is available to anyone, according to the Federal Reserve. One of the main differences to digital cash used in a pay application or bank account is that the money is not a risk of commercial banks. The term "central bank money" refers to the Federal Reserve's obligation to pay the money. It would therefore be an actual US dollar, but in digital format. and not the equivalent of a crypto investment or the holdings within your PayPal.
There are differing opinions on how this might function and what it could look like, but in the end, it could alleviate the requirement for third-party processors when transferring money.
CNN Business' Sarah Hammer, the managing direct of the Stevens Center for Innovation in Finance at the University of Pennsylvania said that the CBDC could be a digital currency issued by the central banks. It would be determined by the fiat currency the country owns, and will consequently be based on the country's cash supply. After this it will be implemented using a government database or approved private sector companies that work with the government.
Yermack is a researcher who has closely following the rise of digital currencies for many years. He stated that CBDC CBDC "would actually function quite a bit as Bitcoin or any other cryptocurrency."
"You'd have a system of wallets, likely owned by members of the public, through which people could pay each other directly without having to use a third party," Yermack stated.
A significant tech decision for policymakers, according to Hammer the author, is whether or not a US central bank digital currency operates on a blockchain. This is the technology that is the basis for cryptocurrencies such as Bitcoin in order to put the weight of the federal government behind the new technology.
Hammer explained that the system could be managed through either a central database or distributed ledger technology such as blockchain.
The Federal Reserve Bank of Boston released last month a joint study on "Project Hamilton", a CBDC experiment. The blockchain technology was used to develop a code base that could process 1.7 millions of transactions per second, according to the statement compiled by the Boston Fed. This was much higher than the 100,000 transactions per second the project was originally envisioned for. Project Hamilton is a research project that focuses on technological experimentation but not the development of an American-friendly CBDC.
Yermack said, however, that it's "likely that whatever they're working with will be the thing that the Fed decides to grab onto and then tries to scale up."
China's digital Yuan does not but operate using blockchain technology. The digital currency is intended to replace cash-based payments and can be accessed through an app that is backed by the government and Tencent's WeChat. It is based on the same infrastructure as approved Chinese offline and online banks and payment services and is issued to the People's Bank of China.
What are the possible advantages and the potential risks?
A CBDC might offer consumers an improved, safer and cheaper alternative to the current options. Hammer said that it could cut down on the requirement for cash, cut down on fraud transactions and make it easier to tax collection and distribute specific government funds.
"There are a few advantages to financial inclusion that come with having a central bank's digital currency," she added, noting that they can connect Americans that don't have bank accounts.
Yermack stated that there are a variety of possible risks, including security and privacy risks as well as technological barriers and security concerns. There are some who worry about the possibility for it to do some of the work done by credit and commercial banks. markets.
In a January report, the Fed specifically warned about cybersecurity risks. The report stated that "any designated infrastructure for a CBDC must be extremely resistant to such threats. The those who manage the CBDC infrastructure must be on guard when criminals employ increasingly sophisticated strategies and techniques."
A CBDC could be a threat to the independence or raise new policy issues.
Yermack said that "the possibility of political abuse was very high." "If you gave the central bank this kind of authority, the safeguards for the political will likely to need to be more robust than the ones those currently being used by the Federal Reserve."
Yermack said that the creation of a CBDC will likely require "thoughtful changes to the way politics are conducted" and a transitional time during which nations try it out over a decade. However, he still believes there are "many compelling arguments" to pursue it.
"Throw into the mix that people don't like using cash — the preferences of the public push governments to change their policies," Yermack said.

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