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TOKENIZATION: BIS INNOVATION HEAD SAYS PRIVATE SECTOR NEEDS TO EMBRACE CHANGE
The BIS Innovation Hub lead, Cecilia Skingsley spoke about the need for the current financial industry to embrace change. It’s one thing if there’s a department exploring the possibilities of tokenization, but if the C-suite is happy with the way things currently work because they’re making money, that inhibits progress.
“Because the financial infrastructures of today, they are not going to be fit for tomorrow,” she said, talking during the Institute of International Finance (IIF) annual meeting.
She believes there are two key requirements for tokenization to work at a global scale. One is digital identity and the other is around regulation. Different jurisdictions are creating their own rules, but there’s a need for mutual regulatory recognition, which will take time. Otherwise tokenization might just take off in certain regions, without the potential global benefit.
While some are disappointed with the slow speed of progress of tokenization, Ms Skingsley said she would have been surprised if it had moved faster. The financial sector needs to be humble.
“The last time the financial industry got really excited about new technology, it was during the securitization era,” she said, noting its contribution to the Global Financial Crisis. Hence, it’s good to be deliberate.
Talking about today’s Financial Stability Board (FSB) report on tokenization, she noted that the FSB’s job is to highlight risks. While everyone wants safety, the public sector wants “safe, safe, safe”, whereas the private sector wants flexibility.
She also shed light on the tradeoffs that central banks consider.
In order to encourage inclusion and competition, the public sector tends to embrace low barriers to entry. That’s until that triggers financial stability risks, at which point the questions is whether they want many participants or a few, and it’s easier to supervise a few.
Another trade off relates to liquidity. On the one hand, fragmented liquidity is not good for efficient markets. But at the other extreme, the public sector doesn’t want to see dependence on one particular marketplace.
In terms of solving liquidity issues, Ms Skingsley doesn’t currently see tokenization as addressing it, although that could change. Most market observers describe the current tokenization sector as fragmented. However, it could swing from one extreme to the other.
Ms Skingsley also noted that a few central banks are adapting their real time gross settlement (RTGS) to accommodate DLT-based financial market infrastructures (FMIs). The Bank of England is one of them.
“An increasing number of central banks are wanting to allow for a DLT-based FMI. And then you will see the beginnings of bridges from the current to what could be future tech.”
@ Newshounds News™
Source: Ledger Insights
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BRICS CURRENCY OFFICIALLY UNVEILED
A mock-up of the upcoming BRICS currency has finally been unveiled at the alliance’s ongoing summit in Kazan, Russia. Indeed, Russian president Vladimir Putin was seen with a mock-up up “BRICS bill” at the summit, the first time the new currency has been put on display.
The BRICS bill in question features the five BRICS nations’ flags (Brazil; Russia; India; China; and South Africa) connected together to form a circle. The displayed currency appeared to be a note with a value of 100. On the flip side of the note appears to be multiple additonal flags, likely of new interested countries that may join BRICS. These include Mexico; Egypt, Nigeria, and Bahrain.
The BRICS bloc has yet to formally announce the launch of the new BRICS currency, however, it has been at the front and center of conversations within the bloc for years. Earlier today, Chinese President Xi Jinping made a historical announcement regarding the bloc’s new payment system.
Speaking to those in attendance, the president discussed why the system is so important to groups that continued seeking a multipolar world. “There is an urgent need to reform the international financial architecture,” Jinping said. “BRICS must play a leading role in promoting a new system that better reflects the profound changes in the international economic balance of power,” he added.
BRICS Currency Launch To Be Revealed Soon?
The blockchain-based BRICS pay system has always been viewed as a key de-dollarization development. For the bloc, it presents a chance to circumvent Western financial infrastructure like the SWIFT payment platform. Therefore, presents a key opportunity for nations within the group to promote the use of their currencies for trade.
The BRICS bloc has enjoyed unprecedented growth over the last two years. It has sought to increase its presence on a global scale and disrupt the West’s dominant run. Throughout the last year, it has increased its de-dollarization efforts to lessen overall reliance on the US dollar. The new BRICS currency will be the next key step in establishing a world where USD isn’t the supreme leader.
The BRICS currency is expected to be backed by gold, the precious metal currently establishing new highs in value. According to reports, the new currency will consist of a backing of 40% gold and 60% tied to local currencies. The regional currencies could involve the Chinese yuan, Russian ruble, and Indian rupee, among other member’s legal tenders.
@ Newshounds News™
Source: Watcher Guru
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🌱 BRICS OFFICIALLY ADDS 13 NEW NATIONS TO THE ALLIANCE AS PARTNER COUNTRIES | Youtube
@ Newshounds News™
Source: Seeds of Wisdom Team RV Currency Facts
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Seeds of Wisdom Team RV Currency Facts Youtube and Rumble
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