A central bank digital currency now has bipartisan interest in Congress because a CBDC might benefit consumers without bank accounts. Poor federal policies contribute to the unbanked problem, and the potential benefits of a CBDC are overstated relative to benefits of private market solutions.
Fed Governor Lael Brainard argued today for a U.S. central bank digital currency to counteract private-backed stablecoins. “It is not obvious that new forms of private money that reference fiat currency, like stablecoins, can carry the same level of protection as bank deposits or fiat currency.”
Software is coming for Wall Street in the same way Facebook's News Feed came for traditional publishers with the rise of blockchain-based decentralized finance (DeFi), designed to replace the role of banks with blockchain-based protocols...
Decentralized exchanges such as Bancor or Uniswap have the problem of impermanent loss, that is, the value of tokens used for market making to join the liquidity pool and the value of holding the currency not to make the market.