Bittrex Global CEO Oliver Finch has some doubts regarding the legitimacy of central bank digital currencies (CBDCs).
Finch says in a new Kitco News interview that CBDCs are a “solution in search of a problem.”
According to the Bittrex Global CEO, the centralized nature of CBDCs makes them inherently different from Bitcoin (BTC) and other crypto assets.
“At heart, the core of the concepts of cryptocurrency and digital assets, in general, is a distributed ledger, it is this distributed ledger technology, is the blockchain.
And so when you get people coming, and by people I mean central governments and central banks, saying ‘oh we’re going to do a CBDC without the distributed Ledger technology’, I just get a bunch of people standing around saying, ‘just because you put the word digital in it doesn’t mean that it’s important or exciting or I want any kind of part of it’.
So I think before you can say is it going to crowd out altcoins, is it going to crowd out Bitcoin, is it going to crowd out stablecoins, you just kind of have to ask yourself, what is it like? What is this product? What is it for? And at the moment there’s just this sense that governments are jumping on a bandwagon, you put the word digital in front of everything…
Just putting the word digital isn’t enough. There has to be a purpose for it. And at the moment it does just seem like CBDCs in general are a solution in search of a problem.”
Finch says that aside from making cross-border transactions faster and cheaper, the concerns and suspicions that CBDCs have raised over their intended purpose are warranted.
“There are legitimate reasons for it. And I think you don’t need to become the sort of conspiracy theorist on what the real motivations are. But I think actually when we get into it the lack of depth for those reasons, it does give rise to a slight pause as to what’s really going on.
So yeah, cross-border payments in fiat currency are a real pain. They’re expensive, they’re slow, they’re sluggish. You could just solve that or make the bank solve that directly but I guess maybe that’s more difficult than creating a CBDC.
So for cross-border transactions there probably is a use case. But then you kind of run out of reasons.”
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