Arab Monetary Fund proposed the network providing company RippleNet as an alternative Central Bank Digital Currency (CBDC) to its economic system. The agency AFM told CBDC poses a threat to the national economy and fiat currencies.
Highlights
- Arab Monetary Fund is not included in introducing CBDC to the economy
- RippleNet is used for instant payments and works as BlockChain technology
- SWIFT also named as a CBDC alternative
The financial body of Arab has proposed an alternative to Central Bank Digital Currency (CBDC) in its economic system. Decentralised RippleNet, works in a BlockChain Network that mainly focuses the instant payments.
The similar nature of cryptocurrency XPR is called unique, citing the premise of its creation. In starting it was used for payments. The XPR cryptocurrency was launched in 2012 and it has a current market value of over $39 billion (INR 2, 98,146 crores), CoinMarkertCap told.
As per the report of the Arab Monetary Fund, CBDC has the considerable risk of rendering fiat currencies powerless.
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Report said
“There are many risks associated with the international position on local CBDC ranging from the risk of digital dollarization, international spillovers, and the impact of the international role of currencies. If a CBDC is used outside of its jurisdiction successfully, this could lead to a local currency losing its function as a medium of exchange, unit account, storage of value, and eventually raises financial stability risk,” a report by AFM’s Arab Regional Fintech Working Group said.
CBDC is the currency based on Blockchain technology that is used to regulate by the Central Bank of the Country. We can also say the CBDC is an alternative to the cryptocurrency like Bitcoin and Ether which also used to be run with Blockchain technology but are not managed by a centralised authority.
Many countries are trying to launch their CBDC assets and India also announced to launch its Digital Assets called the Digital Rupee.
Also Read: Ministry of Communications and Multimedia Support the Adoption of Cryptocurrency in Malaysia
