Paolo Ardoino, chief technology officer at Tether, says that central bank digital currencies (CBDCs) won’t end up being a threat to stablecoins if and when one does finally roll out.
Writing in a Twitter thread, Ardoino, who is also CTO of Bitfinex, argues that fiat money is already mostly digital, just relying on technology outdated by about 30 years, precariously kept together by “rubber and bands.”
“And it requires ton of maintenance with enormous costs… and is not standardised at capillary level,” he said.
“CBDCs are based on the idea that #tether had 8 years ago creating the first stablecoin
– CDBC will replace SWIFT etc
– banks will accept transfers via CBDCs as any wire
– CBDCs will settle most of credit/debit card flow, especially over the weekend.”
Ardoino goes on to predict that CBDCs will ultimately use private blockchains as “modern and cost-controlled tech infrastructure.”
He adds that CBDCs “won’t be issued on your favourite chain,” and therefore, private stablecoins will continue to be relied on.
“Point being: tech evolves but nothing actually changes.
Only bitcoin is our edge.”
The blockchain veteran makes his argument a day after President Biden signed off on an executive order instructing an interagency effort to study digital assets and CBDCs. The order calls for exploring a CBDC “by placing urgency on research and development of a potential United States CBDC, should issuance be deemed in the national interest.”
The order further directs the government to assess the technological requirements and capacity needs for a CBDC in a way that protects Americans.
“The Order also encourages the Federal Reserve to continue its research, development, and assessment efforts for a U.S. CBDC, including development of a plan for broader U.S. Government action in support of their work. This effort prioritizes U.S. participation in multi-country experimentation, and ensures U.S. leadership internationally to promote CBDC development that is consistent with U.S. priorities and democratic values.”