• Home
  • Politics
  • Economy
  • Business
  • Markets
  • Opinion
  • Resources
Wednesday, February 8, 2023
  • Login
No Result
View All Result
WallStreetPro
  • Home
  • Politics
  • Economy
  • Business
  • Markets
  • Opinion
  • Resources
  • Home
  • Politics
  • Economy
  • Business
  • Markets
  • Opinion
  • Resources
No Result
View All Result
WallStreetPro
No Result
View All Result
Home Blogs

New York Fed: Stablecoins are not the future of payments

February 9, 2022
in Blogs, Economy
Reading Time: 2 mins read
0
New York Fed: Stablecoins are not the future of payments
7
SHARES
110
VIEWS
Share on FacebookShare on Twitter

According to a Federal Reserve Bank of New York blog post, Stablecoins are unlikely to be the future of payments despite their growth in the last two years.

The two current forms of stablecoins in the market have numerous problems.

The first type of stablecoins that are backed by safe and liquid assets “unnecessarily” tie up too much liquidity. This ties the reserves and makes them unavailable for other uses in the banking system.

The second type of stablecoins that isn’t fully backed resembles private bank notes, which have historically failed according to the authors of the report, including former New York Fed vice president Rod Garratt and economists Michael Lee and Antoine Martin.

Stablecoins pegged to a government-backed currency such as the dollar or euro have become an important part of the crypto universe because investors use them to buy and sell other digital currencies that are more volatile. The market capitalization of these stablecoins has risen from $5.7 billion in late 2019 to more than $176 billion currently. According to the Federal Reserve and other U.S. regulators these types of stablecoins need more regulation and should be issued by regulated banks.

According to the authors, if distributed ledger technology is here to stay, then having banks issue tokenized deposits would be a more “desirable” and “realistic starting point,” This will allow customers to use them in existing payment infrastructures and this approach overall reduces money laundering risks.

It is important to note that the paper published on the New York Fed’s Liberty Street Economics blog page, doesn’t necessarily reflect the official position of the bank or the Federal Reserve System.

“Central bank actions over the last century have resulted in a well-functioning banking and payment system. Why not take advantage of that, and issue tokenized deposits? Bank depositors would be able to convert their deposits into and out of digital assets — the tokenized deposits.”

New York Fed Authors

Recently, the Federal Reserve published a 35-page paper that discussed developing its own coin. The paper was just a first step and it didn’t intend to proceed without the full support from the White House and Congress.

Tags: CryptoMoneyUSAWhite House
Previous Post

Cathie Wood expects Ethereum to increase 7,200% and hit a $20 trillion market cap by 2030

Next Post

BitMouseDAO: A group wants to inject a Bitcoin into a mouse’s DNA

Next Post
BitMouseDAO: A group wants to inject a Bitcoin into a mouse’s DNA

BitMouseDAO: A group wants to inject a Bitcoin into a mouse's DNA

Discussion about this post

Recommended

Here are Buffett’s top 7 quotes from his latest shareholder letter

Here are Buffett’s top 7 quotes from his latest shareholder letter

12 months ago
These are the only 2 countries in Europe that ‘support’ Russia

Russia: How will they retaliate against Western sanctions?

12 months ago

Popular News

  • Two decades of Alzheimer’s research was based on deliberate fraud by 2 scientists that has cost billions of dollars and millions of lives

    Two decades of Alzheimer’s research was based on deliberate fraud by 2 scientists that has cost billions of dollars and millions of lives

    18012 shares
    Share 7202 Tweet 4502
  • Elon Musk is set to collect $23bn bonus as Tesla fires 10% of its staff. Is it fair?

    92 shares
    Share 37 Tweet 23
  • Cathie Wood expects Ethereum to increase 7,200% and hit a $20 trillion market cap by 2030

    24 shares
    Share 10 Tweet 6
  • You won the Lottery: What should you do next?

    33 shares
    Share 13 Tweet 8
  • ‘Pharma bro’, released from jail, is starting a web3 crypto company. Ponzi scheme?

    33 shares
    Share 13 Tweet 8
  • About
  • Privacy Policy
  • Disclaimer
  • Contact

© 2022 WallStreetPro - The premier page for finance and markets by WallStreetPro.

No Result
View All Result
  • Home
  • Politics
  • Economy
  • Business
  • Markets
  • Opinion
  • Resources

© 2022 WallStreetPro - The premier page for finance and markets by WallStreetPro.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In