Representatives from the Banque de France have spotlighted the central bank digital currency, CBDC, as a key building block for the new international monetary system. In a recent speech, published 3rd of October, Denis Beau, First Deputy Governor at Banque de France, the heavyweight in the world of French economics, labeled the CBDC as the instigator in advancing cross-border payments. Their broader view encourages considering CBDCs from an international perspective from the beginning, rather than as an afterthought.
Beau pointed to two main potential lanes of development for CBDCs. The first is the construction of shared standards and interoperability involving legacy systems and wholesale CBDCs. The second, endorsed by the IMF and the BIS, favours the creation of regional or international platforms for CBDCs. Wholesale CBDCs, designed to be swapped directly on these platforms, could conduct payment versus payment and delivery versus payment transactions.
He also mentioned Project Mariana, an exploration of an automated market maker (AMM) involving the Banque de France, the Monetary Authority of Singapore, and the Swiss National Bank, which successfully concluded in September.
Touching on the tokenization of finance, Beau expressed that the public sector should buttress the private sector now more than ever before to tap into the full potential of blockchain while keeping risks in check. In his opinion, tokenized “central bank money availability” and tokenized assets operate as allies rather than rivals.
The global blockchain finance market is set to blossom into a $79.3B market by 2032, with the public blockchain subsegment taking the lion’s share of market representation in 2023. Renowned crypto ecosystems, such as BTC and Ether (ETH), utilize public blockchains.
Regarding applications of blockchain finance, cross-border payments and trading are two of the leading subsegments. Demand from individuals, industries, and international development groups are powering this trend, with North America pioneering adoption. Allied Market Research projects the industry to grow at a compound annual growth rate (CAGR) of 60.5%, translating to a $79.3 billion market. Blockchain could potentially save financial institutions $10 billion in cross-border payment costs by 2030.
Lower payment costs, domestically and globally, were identified as the chief perks of crypto by over half the respondents in the survey. This viewpoint underscores the Allied Market Research’s report, predicting its growth trajectory on cheaper, safer alternatives.
Source: Cointelegraph
