Central banks' cryptocurrencies will eliminate traditional banks

 

Central banks :

cryptocurrencies will eliminate traditional banks :

Anatoly Aksakov

chairman of Russia's parliamentary finance committee

recently threw a grenade at the financial world.

He stressed that the rise of the central bank's digital currencies (CBDCs)

especially the Russian digital ruble, could lead to the extinction of traditional banks.

As Russia continues

its trials, the consequences of Aksakov's claims on

the global banking system are becoming increasingly important.

With the integration of blockchain technology

traditional bank roles will diminish

Aksakov argued that the role of traditional banks would diminish

with the integration of blockchain technology into global financial systems.

Thus :

these projections reach a pivotal juncture for Russia

which, with effect from August 1, enacted a law allowing the Bank of

Russia (BoR) to formally begin experimenting with its digital ruble.

Unlike traditional currency

digital ruble acts exclusively as an electronic asset.

To manage its impact on the banking system and deter money laundering

the Bank of Russia imposed a daily use limit of 200 thousand roubles per person.

Aksakov strongly supports

the digital ruble's ability to disrupt the traditional financial system.

However

not everyone in Russia shares his optimistic view.

In fact, the public remains sceptical.

Often, they view central banks' cryptocurrencies as potential scams.

Aksakov acknowledges that banks may evolve in the digital ecosystem

 but questions their future role.

According to him, digital ruble, with the help of blockchain technology

and advanced algorithms, can perform most of the banks' current functions.

The robot will make decisions

• there is no need for anyone there.

• Perhaps there is no need for the bank as an institution

• because the digital ruble will be largely technologically sophisticated. 

Aksakov supports the digital ruble's ability to bring

about radical change, but not shared by everyone in Russia.

The public remains sceptical

and central banks' cryptocurrencies are often seen as potential scams.

Loyalty programs may help banks stay relevant

Furthermore :

the Association of Russian Banks also expressed concerns.

• Stakeholders are actively pressing the Bank of

• Japan to clarify expected rules and compensation structures

• as the digital ruble continues to gain traction in the market.

Deputy Governor Olga Skorobogatova proposes that

traditional banks remain relevant through innovative loyalty programs.

We are solving two problems at the same time:

on the one hand, we are building

• and developing the infrastructure for sovereign payments

• and on the other, we are expanding choices for citizens

• and companies. "People should have a choice," said Skorobogatova.

Scrutiny of the Central Bank's digital currencies

(CBDC) is not limited to the Russian border.

Central banks

and financial institutions around the world

including those in countries such as Colombia, are grappling with the issue of

how central banks' digital currencies can change the current banking model