It is fair to say that Bitcoin has been exceptionally successful as a payments’ technology, regardless of its current trading price, particularly given its incredible adoption. It also follows that Central Banks have been contemplating the issuance of their own Central Bank digital currencies (CBDCs) in order to remain competitive as private companies continue to compete aggressively in the payments space, combined with bitcoin posing a real threat. Discussions about CBDCs have featured prominently at both the Bank for International Settlements (BIS) and the International Monetary Fund (IMF).
It is mostly very challenging for new innovations to be adopted and despite the new waves of entrants competing in the payments industry, there have been many a new technology that have wound up amounting to very little, not providing what the consumer wanted and becoming extinct.
That said, several private retail payments’ providers have been able to build solutions on the existing financial market infrastructure and have gained market share in certain markets. However, the real opportunity that exists is with Central Banks to address the gaps in the current infrastructure and if they are able to issue their own Central Bank digital currency (CBDC), they will be able to start to address niche markets, which cryptocurrencies could not realistically ever be able to serve.
The question is, how far away are CBDCs?
I predict 2020.
This excerpt/article was originally posted by the CoinDesk. For full article, click here.