• Shyam Nagarajan, an executive partner at IBM Consulting, says CBDCs have the potential to change payment systems.
• Nagarajan says issuers should consider a hybrid model of permissioned and permissionless currency.
• Rob Massey of Deloitte said programmable money will soon be available in the market.
The potential of Central Bank Digital Currencies (CBDCs) to revolutionize payment systems was the focus of a discussion between Shyam Nagarajan, executive partner at IBM Consulting, and Rob Massey, global tax leader, blockchain and cryptocurrency at Deloitte, during CoinDesk TV’s “First Mover” from the World Economic Forum’s annual conference in Davos, Switzerland.
Nagarajan said that CBDCs are the future of money and that issuers should consider a hybrid model of permissioned and permissionless currency. This would enable banks and other financial institutions to control the currency and its issuance, while allowing users to use it in a decentralized manner. He added that payments will eventually be made with CBDCs, but that stablecoins, which are a form of cryptocurrency pegged to real-world assets such as gold or the U.S. dollar, are currently serving as “stopgaps” until CBDCs are available in the market.
Massey echoed Nagarajan’s sentiments, stating that the ability to use programmable money will soon be available in the market. He believes this will lead to a new era of faster and more efficient payments, as well as enhanced convenience for users. Massey also highlighted the potential of CBDCs to increase financial inclusion and reduce poverty, particularly in developing nations.
The two executives believe that the benefits of CBDCs will only be fully realized if they are adopted widely, and that regulators must ensure that the proper framework is in place to protect users and ensure the integrity of the system. They also noted that there are still many challenges to be addressed, such as ensuring the privacy and security of user data, and that the development of CBDCs is still in its early stages.
Overall, the conversation between Nagarajan and Massey showed that CBDCs have the potential to revolutionize the world of finance and payments, and that the development of these currencies must be done with utmost care. The two executives believe that the benefits of CBDCs will be felt globally, and that they can lead to a more equitable and inclusive financial system.
