Key Points:
- If the US continues to wait to see and lags behind in CBDC adoption, this could lead to trouble and, over time, unpredictable influence, Yaya Fanusie, policy director of the crypto lobby group Council for Crypto Innovation, said in an interview.
- He stated that sanctioned countries are looking for financial institutions that are not controlled or heavily affected by sanctions of USA trade on infrastructure for freer cross-border money transfers.
- Fanusie emphasized that China has an almost first-mover advantage because it has been researching CBDCs since 2014.
The United States government may lose control over the world financial system as a result of its relatively slow progress in developing central bank digital currencies (CBDC), according to Yaya Fanusie, a cryptocurrency researcher, former CIA analyst, and the director of policy at the Crypto Council for Innovation.
In a Bloomberg interview, Fanusie noted that sanctioned governments want to conduct business on financial infrastructure that isn’t governed by or substantially influenced by the United States in order to transfer money more freely across borders.
State-issued CBDCs may be a component of the global financial system, according to Fanusie. It impacts U.S. economic statecraft if the United States has little control over these new norms.
Fanusie thinks that if the U.S. continues to be sidelined and lag in adopting CBDC, this might eventually lead to trouble and unanticipated geopolitical ramifications. According to him, if that changes a little, it doesn’t imply that China will take over or that the yuan will replace the dollar, but rather that sanctioned actors will now be able to conduct business on a viable new train.
Fanusie also mentioned that China is assisting other nations in adopting comparable standards and that there is an array of pilots testing out smart contracts to add programmability to the CBDC.
He went on to say that there could be an unstated race going on on the frontier as countries compete for a strategic advantage.
Fanusie emphasized that China had a near-first mover advantage because it had been researching CBDCs since 2014 and launched its digital yuan pilot version on January 4, 2022. Fanusie says this version of the digital yuan has already processed millions of transactions across millions of wallets so far.
Past observers of the U.S.-China CBDC competition have asserted that China’s CBDC goal is only focused on domestic domination rather than an effort to outperform the U.S. dollar.
Some CBDC critics assert that states are implementing blockchain-based CBDCs in order to keep some level of financial control over their population.
After releasing the most recent edition of its white paper on January 18, the US Federal Reserve has not secured permission from the US government to move forward with the CBDC initiative.
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Source: https://news.coincu.com/170669-delays-in-cbdc-process/
