Economic review

Conference on Digital Fiat Currency held in New York

2018-07-22 03:48:12 (Beijing Time)


NEW YORK, July 21 (Xinhua) -- The second International Telecommunication Union (ITU) Workshop on Standardizing Digital Fiat Currency (DFC) and Applications was held at the Cornell University Bloomberg Tech Campus in New York City.

During the event from July 18 to 20, David Wen, chairman of the ITU Focus Group on DFC, welcomed the participants with an update of what the Focus Group has achieved since the first conference in Beijing last October.

More than 20 central banks around the world has joined the Focus Group only eight months after its kick-off, creating the world's most comprehensive platform and highest level of gathering of global experts working on DFC, or the Central Bank Digital Currency (CBDC), Wen said.

Representatives of central banks from China, Brazil, Egypt, Sweden, Norway and the Philippines shared their DFC research and pilot programs at the gathering.

Sarah Raskin, U.S. deputy secretary of treasury, gave a keynote speech on how the United States is looking at the proliferation of crypto currency and Initial Coin Offering (ICO) from the historic perspective.

The lack of liquidity and the small number of key players behind the hundreds of crypto currencies will allow bad actors to manipulate the prices of these crypto currencies, and result in losses for unsuspecting investors, Raskin said.

The former member of Federal Reserve Board of Directors expressed the belief that DFC will eventually bring stability, trust and efficiency to the innovation and confusion brought about the digital currency revolution.

Yao Qian, vice director general of Chinese central bank's technology department and director of institute of digital money, shared with the audiences the detailed function and architecture of the Chinese central bank's two-layer model. China has been leading the world in the research and design of a DFC solution since 2014.

Gabriela Guibourg from Swedish Central Bank described the eKrona project, a DFC project that has attracted 33 Fintech companies around the world to participate through opening bidding process. A decision on which solutions may be selected will be made toward the end of 2018.

In the Philippines, the ePiso project, supported by the Philippine Central Bank under its regulatory sandbox framework, was commercialized by Rizal Commercial and Banking Corp (RCBC), using DFC technology provided by eCurrency, a Silicon Valley based technology company.

Margarita Lopez, first senior vice president of RCBC, presented a convincing case on how DFC technology can be used to enhance security and provide efficient and interoperable settlement solution among many micro-loan as well as a vast array of vendor networks.

Both Brazilian and Egyptian central banks described their case studies on DFC with detailed plans.

Legal and economics experts from Bank of International Settlement, IMF, Gates Foundation, Federal Reserve of New York, U.S. Department of Treasury, professors from Stanford, Berkeley and Cornell held round table discussions with live debate and discussions of these central bank projects and technologies.

David Chaum, the father of DigiCash, Joey Mandoza who created the first mobile wallet in the Philippines, and Prof Udungu, the ex-governor of Bank of Kenya who made nPesa the most successful mobile payment system in the world, also shared their experiences of pioneering breakthrough technologies for the past 25 years while providing advices on how to successfully promote, deploy and manage a digital revolution.

The three-day conference was jointly hosted by Cornell University, Digital Fiat Currency Institute of San Francisco, and other international organizations.