by James Rickards
Daily Reckoning
Is the move toward central bank digital currencies real? And, if so, is it the first step toward a global reserve currency that will replace the dollar and euro as currencies of choice in reserve positions of major economies?
Well, yes and no.
Before I expand on that answer and explain the impact central bank digital currencies will have on the more familiar world of foreign exchange, it’s helpful to say a bit more about what central bank digital currencies (CBDCs) are.
CBDCs are not cryptocurrencies. The CBDCs are digital in form, are recorded on a ledger (maintained by a central bank or Finance Ministry), and the message traffic is encrypted. Still, the resemblance to cryptos ends there.