If the central bank’s digital currency (CBDC) is fully applied, analysts from Morgan Stanley revealed it will have no impact on the crypto market especially for decentralized technologies.
Morgan Stanley's chief economist, Chetan Ahya, explained that the concept of decentralization has found a place in the hearts of investors and the CBDC clearly cannot match crypto from many aspects due to its decentralized and flexible features:
“Cryptocurrencies will still exist when they are still used in other use cases. For example, some cryptocurrencies serve as a store of value because some people do not fully believe in fiat currencies. ”
Touching on the CBDC, the digitized fiat currency promises easy, fast, cheap and secure transactions. By using blockchain technology, it is safe from plagiarism and errors in the checking of any payment.
However, the method also has its drawbacks. Some experts believe the CBDC gives too much power to the central bank by controlling the entire remittance ecosystem through real-time monitoring of its users ’money flows.
Perhaps that’s why Morgan Stanley sees the CBDC won’t override cryptocurrencies.
In fact, many banks are still divided when it comes to crypto. For example, HSBC bank introduced an anti-cryptocurrency policy in early January to block any transactions from cryptocurrency exchanges.
Instead banks like BNY Mellon have launched Bitcoin protection services (BTC) for investors and hodlers in line with the changes of a more futuristic era.
