Government-Issued Versus Private-Issued Cryptocurrencies, The Key To Mass Adoption?

Government-Issued Versus Private-Issued Cryptocurrencies, The Key To Mass Adoption?

In an interview to CT, the CEO of Dash Core Group, Ryan Taylor, revealed that bank-issued Cryptocurrencies are the best bet for mass adoption of Digital Currencies. He believes that this type of Cryptocurrencies is the “inevitable future” as governments all over the world are starting to appreciate the role of Digital Currencies in the changing economic and financial environments of the world. Nonetheless, it is up to the populace in all regions of the world to decide what form of a unit of exchange they want to use in their day to day transactions.

The Role Of Free Markets Will Play An Important Part On The Projection

During the interview with Cointelegraph, Taylor, appreciated the fact that free markets may eventually design better money than central banks. However, Government institutions have the advantage of enforcing laws and deciding what is legal in their jurisdiction and what is not. In this regard, governments would wish to achieve the best solution by issuing their own Cryptocurrencies that are decentralized and free from monetary of fiscal manipulation. This would serve the interests of both the governments that are involved and free markets that desire complete autonomy.

Factors that influence Central Banks to venture into creating national utility tokens originate from competitors’ pressure, desire for economic autonomy, or effort to Digitalize the local economic environment.

On the issue of the desire for economic autonomy especially by countries that are antagonized by the United States through Sanctions, trade tariffs, political or economic rivalry. These countries strive to create currencies that are free from US Dollars-denominated standards to Digital Currencies that can be used independently for either local or international trade.

Examples of national Digital Currencies are the Petro by the Banco Central de Venezuela, BCV, Estcoin from Estonia, CryptoRuble of Russia, J-Coin of Japan, E-Krona of Sweden, EmCash of Dubai, EDinar of Tunisia, etc. Some of these Cryptocurrencies are on trial while others are already in the market and gaining ground steadily.

Regulation Will Gain Pace In the Coming Years In Regard To Private Issued Cryptocurrencies

Regulation Will Gain Pace In the Coming Years In Regard To Private Issued Cryptocurrencies

Many governments are starting to regulate Cryptocurrencies and Blockchain technological platforms in a bid to protect investors and users from the effects of harmful activities. The urgency that compelled many governments to act started in 2014 when news about Crypto exchange hacking and security breaches started marking news in mainstream media outlets. Also, there was an increase in ICO fraud cases where Blockchain startups were misused by fraudsters to swindle investors before going underground. Further, the volatility of Crypto markets in 2018 in which the total market capitalization plunged from over $800 billion to the current $209 billion also acted as a wake-up call to governments to act.

The Dash CEO forecasts that more stringent regulations will start in “very soon”. However, a lot of action will be seen in smaller economies that are less complex and diverse. For the case of the US, Taylor believes that more regulations will be seen in 2019.

Opinion Is Divided

While Ryan Taylor believes that government-issued Cryptocurrencies will eclipse out private-issued Digital Assets, others are seeing a different scenario. For instance, a Bank of Japan executive questions the practicability of the former stating that the only way for them to success is to eliminate fiat money. However. A July EU Parliamentary study group finding seems to corroborate Ryan’s forecast.

October 25, 2018

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Samantha Mitchell

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