Central bank digital currencies will complement cryptocurrencies rather than competing with them despite not being structurally different from their country’s fiat currencies, strategists and fund managers said.
Around 90% of the world’s central banks are now working on their own digital currencies, some of which may be issued in the next three years, a January survey from the Bank for International Settlements showed.
Central bank digital currencies (CBDCs) “are structurally no different than fiat, and they are very much complementary to crypto, not competitive,” Meltem Demirors, chief strategy officer at CoinShares, Europe’s largest digital asset investment firm managing $5 billion.
The interview was part of a series on digital currencies run on the Reuters Global Markets Forum over the past week.
Kevin Kelly, head of global macro strategy at digital asset research firm Delphi Digital, said he expected CBDCs to improve traditional monetary systems via easier transmission of fiscal policy, while aiding crypto markets by bridging the gap between fiat and decentralized finance (DeFi).