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Will the US Fed Act on a CBDC?
Watch Michael Greenwald’s full interview with Forkast.News Editor-in-Chief Angie Lau to learn more about the internal divisions within the U.S. over a CBDC, the future of Bitcoin as a currency outside El Salvador, how the central banks of the art world are leading the NFT revolution and more. — STORY Michael B. Greenwald, the first US Treasury attaché to Qatar and Kuwait, and now the director of Tiedemann Advisors, sees El Salvador’s venture as Bitcoin’s great inflection point as the world keeps a close eye on Bitcoin’s first national testbed. “Countries like El Salvador, they’re not going to have huge impacts on what the U.S. does or others do, but it definitely does bring the issue to the table and it raises alarm bells,” Greenwald told Forkast.News in a video interview. “Ultimately, it’s going to be the large central banks and what it means for them as they create a new digital asset framework.” In Asia, China’s e-CNY experiments are expanding to more cities and sectors. The digital yuan may be China’s effort to counteract what Greenwald calls the “weaponization of the dollar”. “But let’s remember there’s a divide of the Fed right now,” Greenwald said. “You’ve got Randy Quarles and Lael Brainard, where one is pushing a stablecoin approach and one is pushing a central bank digital currency.” Such divisions will likely spur debates for years to come and may ultimately lead to U.S. policy paralysis, Greenwald predicts, “without any real action.” In the meantime, the digital yuan is already being used widely in what is already essentially a soft rollout across China, from public transport to the country’s futures market, which Greenwald sees as an alarming challenge to the dollar’s future international dominance. According to Greenwald, a future digital dollar and the digital yuan will unlikely cozy up to each other, especially not in the near future. “But I do see a digital dollar in the same wallet as a digital yen or a digital euro or a digital pound,” Greenwald said. “The cross-border issue in a future digital wallet, that’s definitely one of the issues the Fed is looking to tackle in the coming months to years.” — Highlights Will the digital yuan diminish the dollar’s power and influence? “China has been wanting to move away from the dollar for years, and we’ve been in an era of dollar dominance since 9-11 and since all of our sanctions tools have been used against Al-Qaeda, Iran and Russia and elsewhere. Countries like China have been frustrated by the dollar’s power and the weaponization of the dollar. And so this is a very strategic move by China to gain control on the consumer and to slowly cut away at the dollar’s influence. I don’t see that happening any time soon, but it should be a cause for concern for the United States.” Central banks of the art world “We’re in this era where the future of money, there’s so much potential and there’s so much creativity occurring, especially in the art world. [The] major auction houses… Christie’s, Sotheby’s and Phillips, they’re the central banks of the art world. They’re way out in front of this and that excites me. It’s exciting to see how the art world is playing a key role, how smart contracts are helping artists gain royalties and rights for the future. That, to me, really excites me. And it’s a whole new generation of creativity, which is what the United States was founded upon — proactivity and innovation.” Keeping a lookout for Asia’s NFT sales “What I’ve been watching very closely in Asia is NFT sales and auction houses really starting to pick up. Christie’s has a whole NFT department now, and they’ve been having some strong Asia sales numbers as well as Sotheby’s, and you’re starting to see pace in that space as well. So I’m watching how the NFT sales are rising in Asia and what it means for them. At the same time, you’re seeing China trying to crack down on video games. So you’ve got this friction between the authoritarian governments and artists locally.” What might Bitcoin’s future look like? “I view Bitcoin still as very volatile. There haven’t been certain building blocks yet that have given me more confidence in how it’s playing out, withstanding what El Salvador and others are doing, I’m really looking at how central banks are treating Bitcoin and what the E.U. and the Fed and others, how they regard Bitcoin.I think you are seeing more favorability towards Ethereum in what they are doing regarding their environment and their energy use case. But I think on Bitcoin, it’s still very early. For me, you would have to understand how other central banks are going to operate in this basket of currencies. I do believe Bitcoin will be part of that basket of currencies and that future global digital wallet.” — #Crypto #Blockchain #BlockchainTechnology #DigitalAssets #Cryptocurrency #DeFi #CBDC #DigitalYuan #China #Bitcoin #Stablecoin #ElSalvador #DigitalDollar #Ethereum #NFT
