Deutsche Bank: Central bank digital currencies could spark social unrest
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Answer Deutsche Bank: Central bank digital currencies could spark social unrest
Spread Deutsche Bank, Germany’s latest cryptocurrency report, looks at central bank digital currencies (CBDCs) in great detail, and their impact on central banks, individuals and governments.
At the center of the discussion on people, Deutsche Bank says central bank digital currencies, or CBDCs, could face political resistance and could encourage social unrest.
Central bank digital currencies can make a big difference:
The Deutsche Bank report stated that central bank currencies can put users in a good place with financial payments.
Where individuals can experience faster cash transactions without third party interference.
The risks arising from intermediary parties can also be eliminated, and Deutsche Bank also told through its report the following:
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With central banks relying on cryptocurrencies, money transfers can be completely anonymous and decentralized.
Central banks have a lot to develop:
Deutsche Bank notes that central bank digital currencies need to make their use case scenario more attractive than traditional cash.
Where CBDCs need to be efficient and cash-like to overcome skepticism among potential users, Deutsche Bank says:
Currency should function as a medium of exchange, as a measure of value and as a store of value.
Payments must be secure and simple, and universal access must be ensured.
Additionally, for central bank digital currencies to carve out a place in the existing currency system, they need to facilitate the execution of cross-border transactions in a direct and cost-effective manner.
Trade-off between privacy and comfort:
Deutsche Bank pointed out potential problems with privacy and usability.
According to the available data, privacy gaps differ in different places and the strength of the economy.
According for polls By precedent, people remain skeptical about cashless payments, especially in Western European countries such as Germany.
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Also, transactions involving bank promissory notes are still widely prevalent.
This led Deutsche Bank to conclude that the implementation of the central bank’s digital currency system may face heavy political hurdles.
Where legislative resistance can have a negative impact on society in general, leading to social unrest in the view of Deutsche Bank.
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