European Central Bank bets on CBDCs over BTC for cross-border payments
The ECB's interest in identifying the best cross-border payment solution stems from its being the central bank for the 19 countries of the European Union. European Union which have adopted the euro.
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A recent study conducted by the European Central Bank (ECB) on identifying the ultimate cross-border payment method crowned Central Bank Digital Currencies (CBDCs) as the winner against competitors including banks, the Bitcoin (BTC) and stablecoins, among others. .
The ECB's interest in identifying the best cross-border payment solution stems from its being the central bank of the 19 European Union countries that have adopted the euro. The study, “Towards the Holy Grail of Cross-Border Payments,” named Bitcoin the most important unbacked crypto asset.
EBC's view of Bitcoin as a bad cross-border payment system boils down to the highly volatile asset's settlement mechanism, adding that:
"Since settlement in the Bitcoin network only takes place every ten minutes or so, valuation effects already materialize at the time of settlement, which actually complicates Bitcoin payments."
While the study highlighted the scaling and speed issues inherent in Bitcoin, it did not take into account timely upgrades - Taproot and Lightning Network - which improve performance of the network, concluding that "The underlying technology (and in particular its 'proof of work' layer) is inherently expensive and unnecessary."
On the other hand, the ECB recognized the CBDC...
The ECB's interest in identifying the best cross-border payment solution stems from its being the central bank for the 19 countries of the European Union. European Union which have adopted the euro.
New
A recent study conducted by the European Central Bank (ECB) on identifying the ultimate cross-border payment method crowned Central Bank Digital Currencies (CBDCs) as the winner against competitors including banks, the Bitcoin (BTC) and stablecoins, among others. .
The ECB's interest in identifying the best cross-border payment solution stems from its being the central bank of the 19 European Union countries that have adopted the euro. The study, “Towards the Holy Grail of Cross-Border Payments,” named Bitcoin the most important unbacked crypto asset.
EBC's view of Bitcoin as a bad cross-border payment system boils down to the highly volatile asset's settlement mechanism, adding that:
"Since settlement in the Bitcoin network only takes place every ten minutes or so, valuation effects already materialize at the time of settlement, which actually complicates Bitcoin payments."
While the study highlighted the scaling and speed issues inherent in Bitcoin, it did not take into account timely upgrades - Taproot and Lightning Network - which improve performance of the network, concluding that "The underlying technology (and in particular its 'proof of work' layer) is inherently expensive and unnecessary."
On the other hand, the ECB recognized the CBDC...
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