The governor of the Bank of England says that the global reserve fund can be changed, and replace the US dollar with a cryptocurrency that has the same characteristics as Facebook’s digital currency, Libra
Mark Carney, who is the current governor of the Bank of England, proposed a total financial modification to world funds in the US currency, and start using a cryptocurrency that is similar to Libra, which belongs to the Facebook Company, as a savings mechanism for nations of the world.
Some public officials who do not have much to do with the crypto world, such as Carney, have come out to defend new technology as part of a much more progressive vision in the business and finance of the future. Despite the great fear that many nations have experienced after the announcement of Facebook about its next cryptocurrency that will soon be released to world markets.
Carney explained that, although his idea about exchanging the US dollar for a digital cryptocurrency may be crazy, it is a better option than allowing the world reserve fund to be modified by another conventional currency, so it would be more reliable to end up changing the dollar for a reliable digital currency that by the Chinese yuan.
Therefore, he clarified that it is more feasible to create a “hegemonic synthetic currency” -which is better adapted to what the public sector needs through a set of systems that support a cryptocurrency network provided by the Central Bank- than creating another physical currency with a whole series of complex technical and economic changes.
“The combination of greater uncertainty regarding economic policy, absolute protectionism and the concern that, in addition, negative disturbances cannot be adequately compensated due to the limited policy space is exacerbating the deflationary world economy”.
As part of the opinion of Carney, he also said that for the plan to work in the best way, the cryptocurrency should not be presented as Facebook has done with Libra. Thus, this digital currency must be perfect at first. So users can build the necessary confidence for such an important mission.
“Either it succeeds or it doesn’t. If it succeeds it becomes systemic, because it would involve a large number of users. And if you are a systemic payment system, it is 5-sigma. You have to be all the time. You can’t have more problems. You can’t let people lose money from their wallets”, Carney said.
Although it is a bit strange that Mark Carney, the same official that in 2018 commented that Bitcoin (BTC) should not be considered a legal currency since in “traditional terms” it is not, nor does it have any value, he is today defending the participation of a cryptoactive in the most important financial markets of the world.
This demonstrates that, in many ways, this technology could adapt quickly to the future of global financial activity, if it receives support and financing to increase its value and also to increase trust among citizens of the world.
By María Rodríguez