At the recent Future Innovation Summit in Dubai, Cointelegraph hosted a panel titled “ “Stablecoins, Central Bank Digital Currency and Cross-Border Payments” Explore whether CBDC and stablecoins can coexist and how to achieve this.
The panel included Jorge Carrasco, managing director of FTI Consulting; Nikita Sachdev, founder of Luna Media Corp; Jagadeshwaran Kothandapani, head of Middle East and Africa operations at Citibank; and Eetu Kuneinen, co-founder of gold-backed stablecoin initiative DGC.
The panel explored a variety of topics, answering whether stablecoins and CBDCs can coexist. CBDCs are inherently centralized, Kuneinen said, as they will be issued by governments, although they may be built on a blockchain. The executive believes there are certain dangers associated with government control. He explained:
“Let’s say they don’t like certain political opponents. They can freeze each other’s assets with one click. So what gives us any sense of security that they won’t use this? Or if they were a smaller country, they would Being pressured by a larger country to do this?”
On the other hand, the executive believes that creating a framework for stablecoins that are not controlled by a private company may be preferable. “We can build a framework where anyone who owns an asset and anyone who has access to certain technologies can issue it. So we can have multiple banks issuing the same stablecoin regulation,” he added.
Sachdev offers a different take on the subject. The executive said that if the government has intended to freeze a person’s digital assets, they already have various means to do so. Furthermore, Sachdev believes that the government’s exploration of using blockchain for CBDC could be a step forward that could ultimately lead to full decentralization and full Web3.
Although the executive seemed to defend CBDCs, she clarified that she is not yet in favor of CBDCs or stablecoins, as recent events such as the Terra USD (UST) collapse have highlighted that stablecoins can also bring a series of risks to the world.
related: Singapore’s central bank says three business days for stablecoin are ‘timely transfers’
Carrasco added that because the technology is still in its very early stages, problems will inevitably be encountered along the way. “I think it’s normal to see failures and learn from them as we move forward,” he explained. The executive also believes that CBDC and stablecoins may even achieve interoperability in the future. He said:
“I think they will coexist. And, probably within a few years, we will see a transnational agency that will be responsible for CBDC and interoperability between them and make sure that no government can terminate or do something that affects the interests of the people.”
Meanwhile, Kotandapani echoed the sentiments expressed by other panelists, adding that it is always the company or the user who decides which solution is right for them.
The executive said they will determine what specific “pain points” exist and whether CBDC or stablecoins can solve the problem. The executive also believes that as long as stablecoins remain stable and decentralized, the two can coexist.
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