Many former central bank governors and scholars discussed: can digital currency change the international monetary system

The connection between digital technology and the national monetary policy system and the future of the international monetary system has attracted much attention from the market.

On October 22, the 3rd Bund Finance Summit hosted by the China Financial Forty Forum (CF40) was held in Shanghai. Many participants discussed the impact of digital currency on monetary policy and the monetary system.

Jean-Claude Trichet, the former President of the European Central Bank, said that there are two concepts for currencies issued without strict supervision by reliable institutions. Among them, virtual currencies belong to the category of counterfeit currencies; while encrypted tokens belong to the category of speculative assets. . Trichet believes that Bitcoin is a speculative asset and does not have all the characteristics that a reliable currency should have. Therefore, it is necessary to use the blockchain technology through reliable institutions such as banks.

Wei Shangjin, a lifetime chair professor at Columbia University in the United States, said that the current measures adopted by various countries to deal with cryptocurrencies are mainly divided into two categories: some countries choose to completely ban digital currencies issued by the private sector and prohibit them from circulating in the market as a national currency substitute; Other countries are considering launching or even launching their own central bank digital currencies.

Will the central bank digital currency issued by the state become the dominant form of currency in the future? Will this prospect affect the shape of the international monetary system?

The former Governor of the Bank of Japan Shirakawa Fangaki said that many large-scale payment currencies have been digitized in form, and only cash has not yet been digitized. Considering the volume ratio of small payments to large payments, the rise of digital currency itself cannot fundamentally change the shape of the international monetary system.

Shirakawa Fangming also said that within 10 to 20 years, it is unlikely that this revolutionary scenario of the global micropayment market will be realized. The characteristics of micropayment behavior determine that it is difficult to realize a true global micropayment market. For example, in the use of cash payment, the transaction payment environment between countries varies greatly. The transformation process of the form of micropayment reflects the social transformation behind it. In each country, the large-value payment system has formed a unique ecosystem. This kind of ecosystem has disadvantages and advantages. If you leave the global currency system, it is unlikely that the digital global currency will fundamentally change the global micropayment system.

Yu Yongding, a member of the Chinese Academy of Social Sciences, also said that the Chinese government is also very cautious in its consideration of digital currency. Although the People’s Bank of China has issued a small amount of digital currency, it is only experimental. And it will not link this move with issues such as the internationalization of the renminbi. In China, digital payment systems are now blooming everywhere, and everyone can use Alipay and WeChat to pay, but this is still far away from the widespread recognition and use of digital currencies. In any case, be careful.

Barry Eichengreen, professor of economics at the University of California, Berkeley, said that the central bank’s digital currency is coming soon, and the People’s Bank of China is one of the pioneers. However, in the foreseeable future, the central bank’s digital currency will not change the structure and operation of the existing international monetary system.

“If the central bank’s digital currency is to be used for international transactions across borders, it is necessary to ensure the interchangeability of various currencies, and each currency needs to run on the same blockchain. So who will manage this blockchain? Or, another set of infrastructure can be set up so that central bank digital currencies running on different blockchains can use this set of infrastructure to exchange. Then who is going to manage this set of additional infrastructure?” Ai Ken Green said that the scenario where 120 central banks reached consensus on issues such as infrastructure architecture and management methods on the same blockchain is out of reach.

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