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Co-founder of Decred: “digital currencies of the Central Bank are not an obstacle to cryptocurrencies”

The co-founder of the Decred project believes that government cryptocurrencies will not affect public crypto assets, but may affect stablecoins.

In recent years, central banks of different countries have been actively exploring the possibilities of issuing their own digital currencies. In China, the digital yuan is already being tested at ATMs, and pictures of a hardware wallet for it have appeared on the Internet. In the fall, the Central Bank of the Bahamas launched the Sand Dollar, becoming one of the first banks to introduce their own digital currency. Some countries, such as the United States, are taking a more cautious approach to this issue.

However, the Decred CEO believes that even if most countries launch government stablecoins in the near future, cryptocurrencies will still have their advantages. Jake Yocom-Piatt explained that Bitcoin and other cryptocurrencies are more open and fair systems than regular money. Even with some functions of cryptocurrencies, digital currencies of the Central Bank will not be able to compete with them in terms of fairness and equality.

Crypto assets are not tied to fiat currencies, they are not controlled by the state, but by the program code. In addition, territorial boundaries cannot become an obstacle to cryptocurrency transactions. This is the key difference between cryptoassets and government digital currencies.

Cryptocurrencies are issued on a pre-determined schedule, so they won’t be affected by central bank digital currencies. These assets are just a digital version of fiat currencies, however, depending on their specifications, stablecoins may not stand up to competition. On the other hand, too many restrictions are imposed on the digital currencies of the Central Bank, so stablecoins will be able to compete with them in terms of flexibility of circulation.

Investment bank Macquarie said last week that if private cryptocurrencies become too entrenched in payments, government digital currencies could lag far behind.

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