After China, the USA but also France, the idea of a CBDC (Central Bank Digital Currency) begins to germinate in the Philippines on the side of the local Central Bank. As is the case in other countries, the institution is counting on this project to boost the economy and improve its services, especially in times of crisis. So she decided to study the feasibility of her own digital currency by exploring the impacts on the market. It is also expected that such a project will promote the implementation of new monetary policies in the country. Explanations.
Reduce the use of fiat money and improve the provision of financial services
It is undoubtedly the main objective behind the central bank’s approach from the Philippines. The important role played by cryptocurrencies during the covid-19 pandemic coupled with the current setbacks of fiat had already set the tone for this shift towards the CBDC.
Governor of the Central Bank of the Philippines, Benjamin diokno declared a digital currency would also broaden the scope and reduce the costs of financial services. He also admitted that digital currency will improve the way the central bank delivers its services to citizens.
In addition, the study conducted in this direction by the institution includes an in-depth discussion on issues such as price stability and legal barriers. Mr. Diokno then said that the central bank would also assess the impact on the current domestic cryptocurrency market, but also on the financial system in general.
A process that should take time
With a total of 16 exchanges that exerciseIn the territory, the Philippines already has an environment familiar to the use and trade of cryptocurrencies. This was made possible in particular by the adoption of open and flexible regulation of digital assets in the country.
Despite this presence, there is currently no formal agreement with local or foreign institutions to collaborate on a digital currency backed by the central bank. Mr. Diokno nevertheless said that the advent of this currency would follow froman ongoing process of knowledge sharing and close communication with other monetary authorities.
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While waiting for this project to materialize, the country has already launched a platform for the distribution of government-issued bonds using blockchain technology. In this mad race for the CBDC, who will be the first Central Bank to announce its ready currency? France with Forge and Tezos? Case to follow!