At the WebX conference in Tokyo, Binance founder Changpeng Zhao commented on the current state of Central Bank Digital Currencies (CBDCs) and stablecoins, stating that CBDCs are losing relevance.
Rise of Stablecoins and the Fall of CBDCs
Changpeng Zhao stated that numerous countries are currently moving away from developing CBDCs in favor of stablecoins. He noted that at least 10 countries have halted their CBDC projects due to lack of interest and other factors. In particular, stablecoins, such as those backed by fiat, are becoming increasingly popular, undermining the position of CBDCs.
CZ's Views on the Advantages of Stablecoins
During his speech, CZ pointed out that stablecoins backed by real assets are more likely to be accepted by a broader audience. He emphasized that some countries that were previously opposed to digital currencies are beginning to soften their positions in light of stablecoin dominance. For example, Chinese officials are exploring the possibility of launching a yuan-backed stablecoin.
Countries Abandoning CBDCs
As of now, at least 10 countries have decided to abandon the development of their CBDC projects. These include Japan, Denmark, Finland, Singapore, South Korea, and the United States. These countries have cited high costs, difficulties in the testing phase, or lack of retail use cases as reasons for halting their projects. The Bank of England is also considering halting its plans to create a digital pound.
The situation surrounding CBDCs and stablecoins continues to evolve, and according to Changpeng Zhao, the future of finance may belong to the latter. With the global rise in interest towards stablecoins, CBDCs are facing significant challenges.
