According to AMBCrypto, Philip Middleton, chairman of the Digital Monetary Institute, explained in a recent podcast the events that led to the birth of the CBDC and the meaning of digital fiat money.“Two major external events, ” he said of the various external factors driving the establishment of the CBDC.One was last summer Libra announced a possible launch.Thus, a private-sector currency issued by major global technology companies poses a direct threat to central banks and financial stability.The second thing is the new coronavirus.”In this context, the Bank of England is one of the first organizations to engage in global discussions on the prospects of CBDC, and so far it has published various discussion papers on the use of CBDC.
The problem here, however, is that without the help of the private sector, the central government is unlikely to find the answer on its own.Both entities must find a middle ground and find a way to work together.In this regard, Middleton said: “I expect many countries will experiment with the kind of system that the central bank provides money, but the private sector provides money delivery.In fact, private-sector operators are also encouraged to operate on existing tracks if you wish.”The point to note here is that even if the CBDC project ends up as a partnership between the government and a private entity, the private entity has no real say.In addition, with the addition of Facebook’s Libra 2.0, with support from 75 leading technology companies, it will become an important competitor to many central bank CBDC projects.
