Imagina Cryptocurrency can be shared on any social media platform, can be used to pay up your utility bills, and can easily be carried around in your smartphones.
Would bank accounts become obsolete?
Would monetary policy matter?
Would fiat currencies cease to exist?
As the number of Crypto tokens increases, all these questions have become silent. Today, people do not ask about what Cryptocurrencies are and how they can be used in the market. Instead, people are more interested in how they can be used in different ways.
Cryptocurrencies are the digital currency that is created and maintained by Blockchain technology. The concept of Cryptocurrency’s digital currency can help the unbanked nation’s citizens have their money in a secure place.
How Are Countries Preparing To Launch CBDCs?
Seeing how Cryptocurrencies are performing in the trade market, nations have taken the initiative to launch their own Cryptocurrencies, Central Bank Digital Currencies. 2020 was the year when some of the major countries experimented on the CBDCs, and we can hope to see the results of their effort in 2021.
Here are some countries that intend to launch their CBDCs in 2021.
China is the leader of the whole Central Bank Digital Currency concept. It is the first nation that came with an idea to launch a government-backed Cryptocurrency to compete in the Crypto trade market. In 2020, China launched its CBDC, Shenzhen. By the end of 2020, they already had more than 120,000 consumer digital wallets and almost 9000 corporate digital wallets.
Japan has already made the team to explore the lands of CBDCs. This team will also be responsible for overviewing the whole network once the CBDC infrastructure is completed. Right now, Japan is working on the CBDC and wishes to launch a government-backed Cryptocurrency in 2021.
Cambodia has already launched a Cryptocurrency backed by the central bank. The name of the CBDCs is Project Bakong. It is the first CBDC currency in Asia. However, unlike other CBDCs of the world, it does not involve Crypto exchange. Bakong supports both Riel and US Dollars.
4. South Korea
South Korea had already started testing out the trial of the possible CBDCs. According to the report made by Korea Herald, the technical procedure and infrastructure will be completed by 2021 summer. And the testing of the Currency will soon start after that.
The central bank of South Korea said that this test does not mean that they will go with the idea. Unless they feel like traditional finance is lacking, they have no plan to implement CBDCs.
Russia is seriously thinking about launching CBDC. The Bank of Russia has started taking feedback and consultation from its citizens to know how their citizens feel about launching Ruble backed Cryptocurrency. Russia is yet to decide whether they will launch CBDCs or not. Everything now depends on the result of feedback.
CBDCs Frequently ASked Questions
As with new technology, new questions come along. CBDCs have also brought several questions with itself. We have compiled a list of questions to offer what we believe will be necessary when you are dealing with central bank digital currencies.
How CBDCs Differ From Other Currencies?
It is all about the liabilities. Once central banks launched CBDCs currencies, they will be liable for its authenticity. All the money that you keep in your CBDCs accounts will be liable to central banks.
How CBDCs Differ From Other Cryptocurrencies?
As we know, Cryptocurrencies are unstable due to their decentralized nature. However, CBDCs will be backed by the central banks and government.
What Is Driving CBDCs?
Well, many reasons have caused this tropic to be trending in the market. However, we believe that the following reasons were most impactful.
- Need for stable coins in the market.
- Increasing consumer interest.
- Global competitions.
- COVID 19 Impact.
- Payment modernizations.
It is believed that integrating the central banks and government for a different type of Cryptocurrency will help the digital currencies make instant payment efficiently. If you want to take advantage of the CBDCs, it would be better to start learning about the trade market. green profit system is one of the best platforms for beginners who aim to become a full-time trader in the future.