TOKYO (Reuters) – Central banks must get a better understanding of the benefits and risks of issuing their own digital currencies, and look at ways to mitigate any associated perils, Bank of Japan Deputy Governor Masayoshi Amamiya said on Thursday.
Bank of Japan Deputy Governor Masayoshi Amamiya speaks during a Reuters Newsmaker event in Tokyo, Japan July 5, 2019. REUTERS/Issei Kato
By issuing their own digital currencies, central banks can act as a bridge for private sector money flows and streamline settlement, Amamiya said.
All the same, such a practice could also stifle private-sector financial innovation and draw money away from deposits at commercial banks if they succeed in issuing low-cost digital currencies, he said.
“When countries consider issuing central bank digital currencies, they must conduct a comprehensive study on how it affects their settlement and financial systems,” Amamiya said in a speech in Tokyo on Japan’s settlement system.
Some emerging…
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