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- The CEO of DBS Bank group, Piyush Gupta, advises Central banks to start regulating cryptocurrencies and shed their fear that digital assets will replace fiat money.
- Gupta further says that by alienating cryptocurrencies from the regular banking system, it will result in digital assets further into unregulated space.
- Last week, MAS disclosed that it would be declaring the guidelines and oversight in cryptocurrency trading.
CEO of DBS Bank Group, one of the largest investment banks in Singapore, Piyush Gupta, says Central Banks should dismiss their fears that the cryptocurrencies will replace fiat currencies one day and start regulating cryptocurrencies.
During the Global Business Summit sponsored by The Economic Times, he points out that we would be pushing digital assets into unregulated space if we regulate them out of the formal banking system. The owner of private money is unknown, making it a subject of misuse. RBI governor is worried about such issues; monetary systems worldwide have commenced issues pertaining to cryptos, such as KYC and AML.
The recommendations from Gupta came after the Monetary Authority of Singapore made the announcement that it is searching for ways to regulate the digital assets in the city-state properly.
Gupta also dismissed the fears that digital assets and NFTs (non-fungible tokens) will replace fiat money. He further elaborated that there are better use-cases present for the use of cross-border central digital currencies.
The DBS chief, in conversation with a participant, said that cryptocurrencies can be an alternative to gold and its value, but not the money as we see it today. He also noted another issue, which is of volatility in value.
What Are The Various Use-Cases Of CBDCs?
Disintermediation in the banking sector is among the use-cases of CBDC, points out Gupta. But, he adds that CBDCs come with their own challenges; citizens will open a direct account with the central bank if we go direct, disrupting the CBDC directly.
Gupta notes that the onus will be the credit creation for which the central bank will alone be responsible, which they obviously don’t want.
Another use case for the digital assets would be even central banks around the globe introduce their respective CBDCs as a form of fiat currency. He adds, “there is a far greater use case of wholesale CBDCs, especially cross-border.”
Financial institutions and monetary regulators should look at ways to explore and harness the potential of blockchain technology, he said.
Monetary Regulators and Financial Institutions should start searching for ways in which they can harness the blockchain potential.
MAS Considering Rules Regarding Cryptocurrencies
In an announcement last week, the MAS revealed it would declare the oversight and guidelines in the trading of cryptocurrency.
From time on time, MAS has consistently sent out warnings for the public to be careful as there is high risk involved with crypto investment, and the general public shouldn’t be making such investments, said a spokesman in an interview. Adding, the spokesman said Singapore is not the only one who believes so, but certain jurisdictions have taken various measures concerning advertising by crypto firms.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
