The issuance of CBDC by central banks will bring value to Bitcoin

Barry Silbert, founder and CEO of Grayscale Investments and Digital Currency Group (DCG), once again expressed his optimistic stance on Bitcoin. In a call with investors on “Digital Currency Status”, he emphasized that issuing CBDC by central banks would benefit Bitcoin.

“So at some point in the future, we might have 80 different CBDCs. And if that happens, it would trigger a huge investment in financial system operators. Essentially, every financial institution should be able to safely store and transact CBDC. If this infrastructure is built, it can also be used for non-bank digital currencies, such as Bitcoin. ”

CBDCs are digital currencies that are issued and controlled by a central regulatory authority. Unlike cryptocurrencies such as Bitcoin, CBDCs represent fiat money in digital form. Although no global jurisdiction has launched CBDC so far, a number of governments have explored and built such projects.

The issuance of CBDC by central banks will educate the public

According to a new survey conducted by the Bank for International Agreements (BIS), at least 10% of central banks will issue a CBDC for the general public in the short term. The Chinese central bank seems to be the most prepared to launch an e-yuan in a pilot project.

Silbert argued that central banks developing their own digital currencies could offer more power to Bitcoin, paving the way for institutional interest. According to CEO Grayscale, Bitcoin and other cryptocurrencies may eventually benefit from the same infrastructure used by CBDC.

In addition, Silbert expressed confidence that central banks will require users to use and comply with financial systems and will not limit the issuance capacity of CBDC. “Central banks love to print money,” Silbert said to emphasize the limited nature of the Bitcoin offer.

The investor is of the opinion that CBDCs “are not a phenomenon for 2020”, but will be adopted in the future for decades.