Former head of the United States Federal Reserve Rod Garratt is convinced that blockchain technology will soon begin to be implemented in US non-cash payments
Implementing such an approach is challenging due to Americans' lack of trust in their government, but despite this, Garrett believes that blockchain technology could be the key to realizing ideas for a cashless economy in America.
Swedish economic model
Garrett identified Sweden as an example of a successful example of such an economy. In Sweden, cash accounts for about 1 percent of the country's turnover. Some businesses do not use cash transactions at all and do not deal with a bank cash system.
At the MIT Business of Blockchain conference in Boston, Garratt said that central banks will soon begin to implement blockchain technology and issue digital currencies. Previously, Garratt was an adviser to the Bank of International Settlements in Switzerland, which is studying the mechanisms of functioning of state-owned cryptocurrencies.
Methods and solutions
Government-issued digital currencycould reduce fees that are too high for socially vulnerable groups population.
One of the undeniable advantages of distributed registry technology is inexpensive and fast payment processing. To this end, the Swedish government is even trying to create its own digital currency for mobile payments and microtransactions, e-Kpona.
Several solutions in this area are proposed for the United States. So blogger J.P. Koning proposed the idea of releasing the Fedcoin cryptocurrency, similar to Tether, with a 1:1 ratio to the dollar. The only difference between these currencies will be that Fedcoin will be issued by the Federal Reserve as a companion digital currency to the US dollar.
If central banks take cryptocurrencies seriously, then the role of commercial banks will need to be reconsidered. After all, cryptocurrencies work without intermediaries, and the banking system may come into conflict with the new cashless economy based on digital currencies.
According to bitcoinist
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