OP, why is there a need for the central banks to create a national digital currency? The current "cashless" system that they have now and control is working fin for them. If you did not notice your debit card and, or credit card in your wallet as a "digital" version of paper money then you have not been paying attention to how the banks are manipulating is in becoming a "cashless" society.
Don't ask me. Ask The Deutsche Bank, ECB and all these guys.
This guy, Dr. Weidman isn't in favor of cryptocurrencies issued by central banks, he's against digitalization.
Digitalization has the potential to provide financial benefits to the economy, with the risk, however, of disintermediating central banks. As such, the ability of central banks to conduct monetary policy diminishes proportionally to the increase of digitalization.
Dr. Weidman dismisses the notion that privately issued digital currencies may eliminate central bank currencies, reasoning that “central banks are better able to deliver price stability than a rigid monetary rule or an algorithm.”
And according to him this is how central banks intend to fight cryptocurrencies.
My personal take on this is that central banks should strive to make existing payment systems more efficient and still faster than they already are – instant payment is the buzzword here. I am pretty confident that this will reduce most citizens’ interest in digital currencies.
Why is there a need for the central banks to create a national digital currency when the current cashless system is working for them? Maybe because they differ from Dr. Weidman's opinion, maybe they believe that digitalization or blockchain technology is the way to simplify payment process, more efficient, faster transactions, enhanced transparency, system resilience and it would cut the cost of long term record keeping.
I guess a government issued centralized cryptocurrency backed by private blockchain would have the same price stability as it's physical version since the centralized authorities could easily increase or decrease the monetary base.
Countries that are planning to come up with their own cryptocurrencies knows that they can't put a complete ban on bitcoin and apart from decentralization, the technology behind bitcoin has a distinct advantage over the current centralized "cashless" system. So they think that integrating blockchain technology into their financial system would give them an upper hand over bitcoin.
People who prefer using a decentralized currency would stick to bitcoin no matter how many countries launch their own cryptocurrencies.
