Technology
Digital Currencies Will Replace Low Interest Bank Accounts, says United Nations specialist
As low interest rates become more obsolete, digital currencies can supersede bank accounts.
That, Massimo Buonomo, the United Nations world expert on blockchain, said, "when the need for a bank account is eliminated soon digital currencies, in particular central bank digital monies (CBDCs).
Buonomo said banks and credit-cards had a duopoly over digital payments, but that the advent of digital currencies means that users can completely escape it. He also spoke on an online discussion panel on post-coronavirus global financial order on Thursday.
Low interest rates, which are enforced to encourage further borrowing by central banks, can speed up the process as they incentivise account holders to seek returns from other countries. For example, the Bank of England actively reviews the inclusion of interest rates in negative territory, which means that savers are paying the banks for their bank account. US. American. Recently, President Donald Trump called them a 'gift' for negative rates.
The remaining murderous app for bank accounts according to Buonomo was interest rates. But in view of digital currencies that can process electronic payments just as easily, they are at risk of becoming obsolete.
"Who will suffer from it?
For almost 10 years, Buonomo is the United Nations' resident authority on fintech and, later on, blockchain and cryptocurrencies. The International Organization initiated a number of crystal-related initiatives during its term of office, including the sending of aid through Ethereum to Syria and the permitting of UNICEF crypto-donations.
Buonomo said banks remain vulnerable to hacks on Thursday's panel, adding friction by charging transaction rates along with credit card companies.
Digital currencies, on the other hand, "allow you digital money to hold, allow you to pay bills, use your mobile phone with no credit cards, no credit card companies and no money transfer bank charges," he said.
However, he adopted a more measured approach on Thursday, saying that technology limitations and privacy consequences mean that the majority of public block chains are widely unfit for a national digital currency. Overall controls over the system would be required for regulators, he said, and many public blockchains have no required performance.
The only alternative, Buonomo claimed, is digital currencies issued by a central bank. It is a question, as proposed last week by the Digital Dollar Foundation, of whether central banks depend on business banks for cash or go more radical and provide funding directly to private citizens.
"The one-tier model is the most disturbing and feasible," he said. Central banks will sweep the complex social security schemes commonly spread to "the neediest," including those with a disability or reported unemployed, in the developing world. Currency distribution.
In some ways , social security systems can become the central banks' issuance model, Buonomo proposed.
