Alisa DiCaprio from R3, Sian Jones from XReg Consulting, and Ran Goldi from Fireblocks shared their views on the current state and future of CBDCs compared to privately issued stablecoins.
In a panel discussion at Money20/20, the three professionals discussed the potential for cooperation or competition between central bank digital currencies (CBDCs) and stablecoins and the practical implications of widespread acceptance of digital currencies in the real world.
Ran Goldy emphasized the growing adoption of stablecoins, such as USDC and USDT, noting that “30 million people globally use stablecoins,” with monthly transactions reaching $3.3 trillion.
He outlined key use cases, including cross-border and payments to individuals, and highlighted how stablecoins can be used to bypass traditional systems. According to Visa, stablecoins have seen tremendous growth recently, with about $3.3 trillion being traded monthly. The main use cases are cross-border payments, payments, and merchant acceptance.
Alyssa DiCaprio offered a contrarian view on CBDCs, explaining that although there is significant interest, their adoption is still low.
“CBD adoption is less than 0.2% of the currency in circulation in every economy where CBDCs exist,” DiCaprio said, citing privacy concerns and implementation complexities as major hurdles.
This low adoption is due to privacy concerns related to data collection. DiCaprio noted that emerging economies, not developed ones, are leading the way in developing central bank digital currencies due to their simpler banking systems.
“Most (central bank digital currencies) are still in the research stage,” DiCaprio said. “No advanced economies actually do this.”
Sian Jones discussed regulatory views by describing the cautious optimism of regulators. Regulators are interested in the potential benefits of central bank digital currencies, such as improving payment efficiency and financial inclusion. However, Jones also pointed to the inherent challenges and the primary focus of regulators on risk mitigation.
“There is no single digital form of digital money to rule them all, that is my answer,” Jones said.
There is cautious optimism about central bank digital currencies, as they could benefit payment efficiency and financial inclusion. However, Jones emphasized the importance of risk mitigation and the improbability of having one dominant form of digital money.
Geopolitical dynamics
The discussion also touched on geopolitical dynamics, with Goldie noting the impact of European regulations, which require stablecoin issuers to adhere to European standards.
“This is leading to a new wave of competition for stablecoins, which I call the Second Stablecoin War,” Goldie noted.
Somehow, participants reached a consensus that despite the distinct advantages and hurdles associated with stablecoins and CBDCs, the ongoing progress is bringing some serious changes to traditional financial systems.
“Take advantage of the war,” Goldie said. “Be the beneficiary of it because you can actually move your business to better ways.”