By 2030, three to five countries will completely replace their fiat currency with a central bank digital currency.(CBDC), this conclusion was made in the report of the German think tank for financial technology.
The document also warns that if the European Central Bank does not accelerate its efforts to develop CBDCs, the digital yuan will overtake it, but not undermine the dollar's dominance.
European Think Tank,specializing in financial technology and blockchain research, dGen has published a study on the potential impact of CBDC. After examining the history of the most used fiat currencies today, namely the US dollar, euro and Chinese yuan, the company emphasized that the next logical step in their evolution will be the release of digital currencies.
Without specifying specific countries, researchersit is predicted that within ten years at least three countries will completely replace their currencies with CBDC. At the same time, dGen identified several countries that are actively moving towards the release of digital currency.
In this process, China is among the leaders, asas the most populous country in the world is approaching the launch of its DPEC (digital currency) and is already testing it in different areas - transport, banking, online commerce, food delivery and ready meals.
Swedish CBDC is also close to release asa European country initiated testing of the digital crown in early 2020. The country plans to ditch cash by 2025, and the e-Crown will help achieve this goal.
The German think tank believes that the eurozone is lagging behind other regions. This opinion was recently confirmed by the President of the European Central Bank Christine Lagarde.
In her speech, she stated that CBDC can operate in retail or wholesale channels, and the digital euro will complement rather than supplant the current currency.
The dGen report predicts that if the EUwill develop and launch its CBDC, it will have "the opportunity to act as an effective method of settlement in international trade, distancing itself from the policy of a currency war between the US and China."
If the ECB fails to introduce the digital euro by 2025year, the Chinese yuan will surpass it. At the same time, the digital US dollar (the thought of which is only in the air) will remain the most famous fiat currency. Moreover, it can strengthen its position as developing and small countries "consider the possibility of switching to the digital dollar."
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