- According to Ardoino, governments are likely to create their blockchains to facilitate the CBDC rollout as observed with China.
- And indeed, the Biden executive order on crypto indicates the country is making significant research to welcome the CBDC era.
Paolo Ardoino, Chief Technology Officer (CTO) at crypto exchange Bitfinex and the world’s first stablecoin Tether, has outlined his thoughts on Central Bank Digital Currency (CBDC). According to Ardoino, CBDCs will settle most credit and debit card transactions, especially during the weekends. Thereby concluding that CBDCs will replace old payment rails like SWIFT and not the stablecoin market.
Moreover, fiat has already been digitized over the past decade despite not using blockchain technology. Ardoino noted;
FIAT is mostly digital already, but it relies on an outdated tech infra built 30y ago and kept together with rubber and bands. And it requires tons of maintenance with enormous costs. And is not standardized at the capillary level,
Arguably, it is challenging for Ardoino to speak on the stablecoin market and lack to be biased, for as long as he remains under Tether’s payroll. Nevertheless, the greater crypto market community is largely confident that CBDCs will coexist with stablecoins symbiotically.
The stablecoin market has grown to a billion-dollar industry in less than a decade. Remember, it is only around 2016 that the entire crypto market cap was around $14 billion and now moves around $2 trillion. According to market analytics provided by Binance-backed Coinmarketcap, the entire stablecoin market cap stands at approximately $183.6 billion.
Notably, Tether USDT is leading the pack with $80 billion, closely followed by USD Coin, Binance USD, and Terra USD with $52 billion, $18 billion, and $14 billion respectively.
CBDCs and stablecoin market outlook
The stablecoin market has grown as much as the crypto market has evolved. Furthermore, Tether, which is the oldest of all, has been in existence for the past eight years, while crypto is slightly above a decade.
According to Ardoino, governments are likely to create their blockchains to facilitate the CBDC rollout as observed with China. And indeed, the Biden executive order on crypto indicates the country is making significant research to welcome the CBDC era.
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“My Administration places the highest urgency on research and development efforts into the potential design and deployment options of a United States CBDC. These efforts should include assessments of possible benefits and risks for consumers, investors, and businesses; financial stability and systemic risk; payment systems; national security; the ability to exercise human rights; financial inclusion and equity; and the actions required to launch a United States CBDC if doing so is deemed to be in the national interest,” the Biden crypto executive order reads.
Other countries around the world including France are miles ahead in CBDC implementation. To a great extent, the crypto market has just begun its long journey of adoption. Mind you, less than 1 percent of the world’s wealth is in crypto. Additionally, the total number of crypto users as of 2021 was 100 million out of a possible 7+ billion.