- A recent European Central Bank (ECB) study shows the best X-border payment solution.
- The winner of the recent study is Central Bank Digital Currency (CBDC), which marks its winning against banking, BTC, stablecoins, and others.
ECB Research Study
The ECB’s concern is finding the best x-border payment solution for the 19 European Union countries to adopt Euro. The study of ECB refers to BTC as a most vital unbacked crypto asset. The ECB named their study “Towards The Holy Grail of Cross-border Payments.”
ECB’s study shows BTC as a bad performer in the x-border payment medium. The study states, “Since the settlement in the Bitcoin network occurs only every ten minutes, and valuation effects are already materialising at the moment of settlement, making Bitcoin payments more complicated.”
The study of ECB features Bitcoin’s fundamental scaling and speed issues. Elaborating the irregular upgrading on its network- Taproot and Lightning Network. That will boost the network speed and performance. But the prime technology turns out to be a bit expensive and useless.
Additionally, the ECB believes CBDCs to be the best X-border payment medium. It delivers a great facility with the forex exchange (FX) conversion. CBDC features two important benefits that ECB shows in its study.
The first one is the preservation of monetary sovereignty. And the other one is the easy and quick payment using the mediators like central banks.
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The Governor of the Australian Central Bank, Philip Lowe, stated that the private solution “will be better” for digital currencies by lowering the risks via regulators. The risks of crypto adoption are minimised by proper and strong regulation.
Lowe said, “If these tokens are going to be used widely by the community, they are going to need to be backed by the state or regulated just as we regulate bank deposits.”
The research study of the ECB strongly shows support for CBDC as a best x-payment platform. While it also recommends the monitoring of regulators over cryptocurrencies.
Source: https://www.thecoinrepublic.com/2022/08/03/ecb-belief-in-cbdc-for-the-best-x-border-payment-solution/