Bank of England favors institutional cryptocurrencies model
The document on the design, benefits and consequences of three possible bank models of cryptocurrencies was presented
In a recent speech on the future of finance in the United Kingdom, the director of the Central Bank of the European country, Mark Carney, released details about a proposal to launch three bank models of institutional cryptocurrencies.
Carney had already spoken out in favor of the creation of a national digital currency. But the institutional cryptocurrency plan currently occupies the attention of the authorities of the Central Bank and the rest of the local banking entities.
The three models they study are really financial strategies and are divided as follows:
- Access Model to Financial Institutions. Or also Model FI. Banks together with the Non-Banking Financial Institutions (NBFI) become exclusive users of the digital financial tool.
- Access to the whole Economy. Formed in turn by two groups: on the one hand individuals and companies and on the other the banks and the NBFI. Both may participate in the purchase-sale of the cryptocurrency through the exchange platform.
- FI + model. Includes the two concepts above to achieve the group of financial institutions with CBDC-Backed Narrow Bank Access. With this model, banks and NBFIs have access to cryptocurrencies but are connected through an agency that would allow private individuals to access the digital currency of the Central Bank.
The three models will be analyzed in detail as well as other aspects related to the crypto universe, such as the fluctuations of the Bitcoin market and its permanence over time, the local monetary and financial system, as well as the possible reduction of bank balance sheets.
Source: Diario Bitcoin
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