MasterCard's use of cryptocurrencies for central banks

 

 

MasterCard's

use of cryptocurrencies for central banks

Mastercard, the world's second batch processing company, considers the biggest challenge faced by cryptocurrencies issued by central banks to be adoption.

At present

Mastercard, which is the second largest payment processing service provider

sees no strong outlook for central bank digital currencies (CBDCs)

in the near future.

Consumers currently feel good using cash as a payment method.

In an interview with CNBC

Ashok Venkateswaran, Head of Digital Assets and Blockchain in

Asia Pacific at Mastercard stated

There is not enough justification for a central bank's cryptocurrency.

He added that cash remains the most used payment method yet.

Venkateswaran noted that the main challenge was to accept

and adopt cryptocurrencies.

Thus

if you have a central bank cryptocurrency in your portfolio

you should be able to use it anywhere you wish, quite similar to

the paper cash currently in circulation.

However

the President of the Asia-Pacific region acknowledges that

there may be use of central banks' digital currencies in

 the case of inter-bank settlements.

Venkateswaran specifically addressed Singapore

and its efforts in adopting the Central Retail Bank's digital currency.

The need for Singapore's state

run digital currency is not convincing enough

since there is a very effective payment system in the region.

Venkateswaran stressed that

there was no reason to

issue a cryptocurrency to Singapore's retail central bank

but there might be a case for issuing a cryptocurrency to

the central bank wholesale for inter-bank settlements.

Venkateswaran's remarks

follow those of Kristalina Georgieva

Director General of the International Monetary Fund (IMF)

in which she noted that

central bank cryptocurrencies may eventually replace cash

and the cost of their distribution in island economies.

The head of the International Monetary Fund (IMF)

stressed that digital currencies

can provide flexibility in advanced economies

and contribute to enhancing financial inclusion

where many individuals do not have bank accounts.