Diffusion Digital 2020: The Future of CBDCs

TL;DR

This panel discussion explores the progress and challenges of implementing CBDCs, with insights from experts in New Zealand, Germany, Bermuda, and the United States.

Transcript

welcome everybody to diffusion to the second day of outlier ventures diffusion conference it's a pleasure to be here with you i am rumi morales i'm a partner at outlier and welcome to a really exciting day um we have a great lineup including a fireside chat with joe lubin of ethereum d5 deep dives the tasers and dia and lots of awesome panels from ... Read More

Key Insights

• 🇳🇿 CBDCs are being approached differently in various countries, with New Zealand taking a public-private approach and Germany emphasizing regulations.
• 🇺🇸 The United States is rapidly catching up in the CBDC space, driven by the need to modernize financial infrastructure and meet the demands of tech-savvy generations.
• 🖐️ Private sector innovation and startups play a crucial role in developing protocols, infrastructure, and applications for CBDCs.
• 📼 Clear regulatory frameworks and definitions for digital assets, including stable coins, are essential for the growth of the crypto and blockchain industry.

Questions & Answers

Q: How do startups play a role in the development of CBDCs, particularly in the retail sector?

Startups act as early adopters and can work closely with central banks to develop protocols and infrastructure for CBDCs. They can build wallet providers, integrate digital currencies into traditional payment systems, and ensure regulatory compliance.

Q: Are stable coins necessary in a future with CBDCs?

Stable coins may continue to exist, but their role will depend on how open central banks are to innovation on top of their CBDCs. If central banks allow programmable features and API access to their currencies, the need for stable coins may diminish.

Q: Is cash becoming obsolete in a post-COVID world, and are central banks ready for a cashless society?

Cash is already being phased out in many countries, and CBDCs could accelerate the transition to a cashless society. Central banks need to modernize their financial infrastructure and recognize digital infrastructure as critical infrastructure.

Summary & Key Takeaways

• The panel includes experts from New Zealand, Germany, Bermuda, and the United States, each offering their unique perspectives on CBDCs.

• New Zealand is taking a public-private approach, allowing a private company to issue a sovereign-backed digital currency with government collateral.

• The United States has rapidly moved from being skeptical of CBDCs to exploring pilot programs and recognizing the need to modernize digital payments.

• Germany is taking a conservative approach, focusing on regulations and defining the role of stablecoins in the future financial system.

• Bermuda sees itself as a test bed for private sector innovation and aims to attract startups to showcase the future of blockchain-based financial services.