Central banks around the world have always been vary of cryptocurrencies, and now when cryptocurrencies have been swaying the markets with significant results, these banks seem to be living in denial, failing to see the huge shift that is taking place as more and more people start using crypto over fiat currencies.
Recently, the European Central Bank expressed its unrest with the searing cryptomarket by stating that crypto has no significant implications for the monetary policy. They have released a report stating their stance on the present crypto economy which details the points they are making against the “fake economy”.
The report says that cryptocurrencies in their present form will never be able to replace fiat currencies because they don’t fulfil the functions of money and cannot have any tangible impact on the real economy.
Corporations seem to Disagree
There are major companies in the silicon valley, including Amazon and Facebook, looking to enter into the crypto market with their own cryptocurrencies that will help their users make better use of their already present payment functions in a more secure and easy way while protecting the privacy of their payments
The negative sentiment expressed by the central banks does not seem to resonate with the tech giants as they move towards building their cryptocurrencies. It is the result of the increased interest of the end users in cryptocurrencies. As more people become aware of the advantages of cryptocurrencies, it is apparent that people will understand how they are better.
Corporations know this and leveraging this new found knowledge in the consumers to create their own crypto, which will help make them more profit in the near future as crypto starts gaining bullish exposure in the market.
Central Bank’s Other Side of the Argument
Interestingly, the report also states that the increased interest in the cryptocurrencies by the consumers should prompt central banks to look into the underlying technology and try to implement it into their own currencies to create a central bank issued a cryptocurrency.
It also shows how it can be done by making these cryptocurrencies “digitalized and safe”. It shows that this would allow central banks to present customers with crypto assets that are not volatile but safe to use. But will these cryptocurrencies be decentralized if they ever come into existence? Nobody knows yet.
The report says that there needs to be more research in the domain to come to conclusive decisions. If indeed, these central banks come up with their own cryptocurrencies, the market will see a huge bullish rise than it has seen so far.