Are banks ready for digital currency?

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One day, Nigeria’s paper money or banknotes would be disrupted the way it is happening with banking transaction presently, and digital currency would be in use.

Paper money would be a history just like bata and commodity. It will happen in this country, it is only a matter of time. As it were, coins are gradually going into extinct.

Digital currency is a type of currency available in digital form. It can be used to purchase goods and services but can also be restricted to certain online communities.

Central Banks have always safeguarded their country’s currencies and some like the Nigeria’s Central Bank, have issued warning against cryptocurrencies.

However, some regulators have started experimenting with the idea of cryptocurrencies and the underlying blockchain technology.

The South African (SA) Reserve Bank is warming up to the idea of digital currency and has asked the industry to help it come up with the best ideas.

Some of the world’s biggest banks are said to be investing around $50 million to build a blockchain-based digital cash settlement system.

In 2015, Swiss banking giant UBS was said to be working on a cryptocurrency that would be “linked to real-world currencies and connected to central bank accounts” along with blockchain startup Clearmatics.

Reuters report noted that Bank of New York Mellon Corp, State Street Corp, Credit Suisse Group, Barclays, HSBC Holdings and Deutsche Bank have also been working on the “utility settlement coin” (USC) project.

The International Monetary Fund (IMF) last week said that Central Bank Digital Currencies (CBDC) is one of the significant issues deserving consideration by policy makers.

The Fund said less than one-quarter of central banks around the world are actively exploring the possibility of issuing CBDC and that so far, only four pilot projects have been … Read More...