Economist and professor at De Montfort University Richard Werner believes that government cryptocurrencies are openly competing with traditional currencies, and this can be called a real war.
At the Web Summit conference, Richard Werner said that he is an adherent of a decentralized economy. Werner noted that the current economy, with significant power accumulating in the hands of private banks and large financial institutions, is not working very well. In addition, all these organizations seek to strengthen their positions against the decentralized economy.
“State digital currencies are projects when ordinary people really open their own account with the Central Bank of the country. And private banks cannot control these financial flows. It turns out that the state regulator begins to compete with private banks. And, of course, they cannot oppose the Central Bank of the country. This is a real threat to the power of private banks,” Werner said.
At the same time, the economist believes, there is a way to decentralize the economy and make it more prosperous – to issue a license to private banks to issue their virtual currencies. Then local small firms will have access to these funds. In the current financial system, large banks do not support small companies much, they are focused on large transactions. But when the economy is decentralized, then any company can apply to a local bank and get the necessary support. Werner also noted the role of blockchain in creating such a decentralized economy:
“The standard system is a centralized registry, which is the responsibility of the Central Bank and banks that have access to it. But when you use the blockchain, then each participant in the system can verify any transaction. You have this opportunity, and each participant is responsible for their own operations. This is an interesting tool, it provides transparency and necessary accountability.”
Recently, the head of the largest cryptocurrency exchange Binance, Changpeng Zhao, said that state-owned cryptocurrencies (CBDCs) cannot threaten the cryptocurrency industry.