The former CEO and founder of Binance, Changpeng “CZ” Zhao, calls the digital currencies of the central bank “exceeded” in the face of the acceleration of the stablecoin. What happened to CBDC and why do they disappear now?
Summary
- CZ says that the digital currencies of the central bank are now “exceeded” while stablecoins continue to dominate the world market.
- Until now, at least 10 countries have interrupted the continuation of CBDC pilot projects due to the lack of demand and other factors.
During his opening speech at the webx conference held in Tokyo, Japan, on August 25, CZ underlined how countries moved their position to digital currencies, especially in the case of stabaces.
He observed a global trend in governments embracing stabbed, as shown by the emergence of the regulatory framework focused on the asset supported by the Fiat. These include the Hong Kong Stablecoin order and the Act respecting engineering in the United States.
In fact, he went so far as to say that the CBDCs lose steam in the face of the accelerated adoption of the stables, becoming exceeded compared to its stronger competitor.
“The digital currencies of the central bank are already exceeded. However, the stablecoins attract more attention,” said Zhao in his speech.
Earlier this year, Standard Charterd would have projected that the Stablecoin sector will increase to reach 2 billions of dollars of value. It is currently estimated at around $ 260 billion.
The vision of the CZ on the stages vs cbdcs
During its session, CZ took the opportunity to highlight the advantages of the use of stablecoins on the digital currencies of the central bank. According to Zhao, stablecoins are more likely to be accepted by the wider market because they are supported by a “guarantee and real support”.
In addition, he observed that certain countries which are notoriously opposed to digital currencies are beginning to soften their positions following the domination of the stablescoin.
In particular, China would explore a stablecoin to support the yuan to counter the influence of USD stablecoins. Although the country has prohibited the trade in cryptography and mining since 2021, the country officials have in charge of experts to deepen digital currencies and the feasibility of changing their position.
On the other hand, CZ explained how certain countries began to experiment with various CBDC projects from 2013 or 2014 until the 2020s. However, these projects quickly faded in the dark after the Stablecoins exploded on the market.
CZ cited a lack of CBDC request as a reason for their defeat. However, he also mentioned that only a few selected managed to go to the adoption phase; Including the dollar of sand of the Bahamas, the tunes of Nigeria, as well as the E-Cedi of Ghana.
In fact, the president of the European Central Bank Christine Lagarde said that the Central Bank was preparing to launch the digital euro by October 2025.
How many countries have abandoned CBDC?
In recent years, at least 10 countries have chosen to abandon their quest to develop currencies controlled by the bank in favor of continuing the adoption of stables. The adoption of guidance and establishment of national innovation for the American stable law or the law on engineering in the United States has stimulated additional acceleration in this sector.
Countries like Japan, Denmark, Finland, Singapore, South Korea and the United States have said that they will take a break or dissolve their CBDC pilot projects. Many of them have cited high costs, difficulties in the test stadium or a lack of use of retail as reasons for the stop.
More recently, the Bank of England plans to stop the plans to create a digital book as the global objective moves to Stablecoins. Although the final decision is still awaiting approval, banks have been invited to focus on CBDC to develop “payment innovations that could lead to similar advantages” for customers, namely tokénized deposits.
