If you’re looking for people who are against the cryptocurrency innovation, you would first count Nouriel Roubini before others.
After writing in the past that Central Bank Digital Currencies (CBDCs) would phase out decentralized cryptocurrencies, Nouriel now followed up that claim with what appears to be a reminder that CBDCs would not be on a distributed ledger like other cryptocurrencies.
The famous crypto critic shared his latest thoughts in a collective panel with Ethereum’s co-founder Vitalik Buterin on April 4, at the Deconomy conference held in Seoul, South Korea.
He claimed that the adoption of the central bank digital currencies (CBDCs) wouldn’t be based on distributed blockchain systems, but on single secured ledger controlled by a country’s central bank.
Under such a centralized format, He noted that individuals and corporate bodies will still have to consult banks to access balance sheet of central banks since banks alone have direct access to it in today’s financial system.
Since CBDCs will be centralized, Nouriel cautioned crypto enthusiasts against getting excited when they hear reports about CBDC adoption.
In his exact words, he said,
“As soon as there is news about [CBDC issuance] the people in crypto get excited and say, see it’s becoming mainstream […]. But if you look carefully about what they [banks] want to do, if and when they’re going to do it, it’s not going to be blockchain; it’s not going to be crypto […] it’s going to be on a single ledger, secured.”
Moving forward, Nouriel also spoke both in favor and against the adoption of CBDCs. From the negative angle he believes that these digital currencies will increase the tendency of transaction cost and time-efficiency gains, while on the positive, adoption of CBDCs will displace cryptocurrencies, bank deposits and also digital payment mediums like PayPal.
Emphasizing more on the displacement of cryptocurrencies, Roubini said that it would be entirely expected if international governments suppress anonymous transfer systems or debunk the myth in crypto decentralization.
Talking of CBDCs, Coinfomania recently reported that the Bank of Thailand (BoT) is developing a CBDC in partnership with eight local financial technology institutions.