Wholesale CBDCs are one of the projects Europe Central Banks are experimenting with in terms of making digital currency available to users.
According to plans, Raphaël said that the project is targeted at benefiting issuers as well as investors. However, he said that results show that fragmentation of the market is in sight with primary markets having access and little for the secondary market.
She explained that the focus at each level of the migration should be on giving value, and not just following trends. She also stated that solving the problem of interoperability between the old system and the new system will remove fragmentation and liquidity risk.
Crypto data is fake
Bertrand de Mazières, Director General for Finance at the European Investment Bank said that DLTs are good tools to use especially in the aspect of tokenization. “Tokenization is the future of money,” Bertrand said, but there’s a need to understand how this technology works to prevent fraud and theft.
He stressed that a lot of crypto data is fake as organizations encourage these falsifications to attract investors. If Central Banks issue Wholesale CBDCs, Bertrand explained that they will help make atomic settlement available, AMM, and other DeFi services to the public on a trusted infrastructure.
Thus, having a CBDC issued by the Central Bank is important as the Central Bank remains the balance for monetary systems, he continued.
The scenario that might play out is where different nations will issue CBDCs and have specific regulations to control theirs, Tobias predicted.
At the core of it all, he suggested that wholesale CBDCs by central banks, stablecoins by central banks, and stablecoins by non-banks should all go through regulation for stability.