The head of Bundesbank condemns the idea of central bank digital currency
- Jens Wiedmann says cryptocurrencies can destabilize the financial system.
- The experimental blockchain projects failed to show impressive results.
The head of the German Central Bank Jens Wiedmann thinks that much-discussed central bank digital currency (CBDC) is a bad idea.
This type of assets would lead to severe consequences and serve as a destabilizer for the financial system and heighten the risks of bank runs, he said in a recent speech in a speech in Frankfurt, Germany.
Meanwhile, at the end of May, the president of Bundesbank expressed a critical view on a blockchain. He claimed that the trial project to integrate the technology failed to produce spectacular results and turned out to be slower and more costly than the existing system.
Notably, the head of Bank of Lithuania and a member of the ECB's governing council Vitas Vasiliauskas takes the opposite view on the subject. He believes that CBDC would be a novel type of central bank money. Recently he talked about the matter to the Bank of International Settlements (BIS).
Author
Tanya Abrosimova
Independent Analyst
