With China almost close to launching its Central Bank Digital Currency (CBDC), Japan’s finance minister Taro Aso noted that it is high time finance ministers from the world’s seven-largest economies (the G7) established policies for this new form of digital payment.
As reported by ABS CBN News today, Aso told journalists in a press conference ahead of the G7’s first-ever meeting of the year slated to hold online on Friday, saying:
“I think it’s important for us to thrash out policy measures regarding Central Bank Digital Currency.”
Notably, the regulators are also expected to provide measures to cushion the effect of the coronavirus (COVID-19) pandemic on world economies, create debt relief programs for developing nations, among others.
G7 Concerned About China’s CBDC
Before now, global regulators have shown concern about China’s intention to develop its own CBDC.
They fear that if China issues its own digital currency, it could negatively impact the economic value of other nation’s fiat currencies, considering the country’s vast population and rapidly growing economy.
Despite concerns about China’s plan to launch its CBDC, the populous Asian nation has not relented, as it is committed to unveiling the digital currency soon.
China had already conducted several trials of the CBDC across major cities in the country, including Shenzhen, Chengdu, Suzhou, and Xiongan.
The country believes that its CBDC could play a significant role in dethroning the US dollar’s dominance as the world’s primary reserve currency.
G7 Ministers Scrutinize Facebook’s Stablecoin
The G7 ministers consist of financial leaders from France, Britain, Germany, Canada, Italy, Japan, the United States and has been instrumental in protecting the global financial system.
In 2019, the G7 ministers were among the regulators who expressed concern about stablecoins, especially Facebook’s Libra cryptocurrency project, currently known as Diem.
Facebook’s cryptocurrency had its challenges right from when the project was announced in June 2019, with regulators believing that the digital currency poses a risk to the world’s financial system.
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Author: Lele Jima