The global coronavirus pandemic has changed the world community’s attitude toward cryptocurrencies and has forced the economies of many countries to create a payment tool with which you can quickly and easily make payments. So, the group of the most influential central banks from Canada, Japan, Sweden and Switzerland, as well as European Central Bank and Bank for International Settlements are going to create a commission to monitor the possibility of launching national cryptocurrencies in their jurisdictions. Meanwhile, the United States, South Korea, the UK and France are launching new digital currency projects in practice, and China is testing the digital yuan with all its might.
It becomes obvious that the digitalization of the economy is inevitable, and electronic currencies in the near future will become widely available for ordinary citizens. However, not everyone understands what this will change. Today we will tell in detail how the emergence of national cryptocurrencies can affect the global economy.
National cryptocurrency will increase the level of GDP
The Central Bank of People's Republic of China has already launched digital currency testing in the cities of Shenzhen, Suzhou, Chengdu and Xiong'an as part of a pilot program. So, Chinese officials will receive transport subsidies by electronic payment, and the citizens of the Celestial Empire will be able to pay with cryptocurrency in popular cafes and restaurants.
According to the Chinese government, the main goal of introducing electronic money is to reduce dependence on the US dollar. Alternative money will help the country not only damp the sanctions at the national level, but also weaken their influence on some large corporations.
Moreover, state-owned cryptocurrencies will help accelerate transactions and increase their volumes, thereby increasing the level of GDP, which suffered due to COVID-19 pandemic. One thing is clear – the integration of digital money will change the economy both globally and at the level of personal assets of the population.
Goods will become cheaper
Today the world uses completely different tools for making payments, but the most common are plastic cards of international companies. On average, when paying for goods and services, 1-2% of the cost goes to payment system providers.
With the advent of national cryptocurrencies, the need for intermediaries will disappear, which means that purchased goods will become cheaper by reducing the cost of commissions. Their size will be assigned by the issuer of digital currency, that is, by the state, and not by large corporations whose purpose is to maximize profits at any cost.
The ability of the population to control the state budget
Cryptocurrency technologies will make the work of government authorities more transparent. In some countries, the corruption is still strong, which is why the money allocated to solve a particular problem does not reach the recipient in full.
Using digital currency, citizens will be able to track where assets from the state budget have been spent, social support for the poor will be controlled, and commercial banks and payment systems will not be able to get their percentage from such payments.
Are national cryptocurrencies a reality yet?
Despite all the advantages, many states are still skeptical about digital currencies. Especially in the case when these currencies claim the title of world ones.
For the state to be able to launch its own digital currency, it is necessary to repurpose central banks into advanced technology companies. This is a serious challenge for the economies of the countries, therefore, states are cautious with the launch of digital currencies until they form a reliable team of professionals and acquire the necessary equipment.
However, it is worth noting that coronavirus pandemic has become a real driver of the development of countries, and now many of them are actively considering the opportunity to follow the example of China and create their own national cryptocurrencies. Will they do it or not, but in the very near future great changes will appear in the field of digital finance of the global economy.
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