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digital peso

Central Bank of Chile Studies Issuance of a Digital Currency

14/05/2022 by Idelto Editor

Bank of Chile

The Central Bank of Chile revealed it is studying how to issue a national digital currency, the digital peso. The bank issued a report titled “Issuance of a Central Bank Digital Currency in Chile,” where it explores the possibility of the creation of a central bank digital currency (CBDC) in the future, the mechanism it might use, and how it will consult all sectors of the economy on this issue.

Central Bank of Chile Considers CBDC Issuance

More banks in Latam are considering the issuance of their own central bank digital currencies (CBDCs) to take advantage of the different opportunities they might present. The Central Bank of Chile has just issued a new report studying the opportunities and drawbacks that the issuance of a digital peso might bring. The report, titled “Issuance of a Central Bank Digital Currency in Chile,” also studies the different forms that such a currency might take.

The document, authored by the payments group of the bank, was “framed in a context of increasing digitization of payments, which has been driven by rapid technological progress and the incorporation of new instruments and players in the payment market.” In this sense, the report concluded that:

The issuance of a CBDC would enable the benefits associated with digital transformation to be enhanced, while mitigating some of its risks. In particular, a CBDC could contribute to the development of a more competitive, innovative, integrated, inclusive and resilient payment system.

The report also calls for further analysis of the cost-benefit balance of issuing such a currency.

More Studies Needed

While many central banks in the world are studying and investigating the issuance of digital currencies, not many have moved to the execution phase. The document calls for more analysis and studies in this regard, as there are virtually no standards or best practice guidelines about how to proceed with the construction of such a project.

Digitization of the currency could also cause unforeseen negative impacts on the national economy, so any implementation in the future would have to be “carefully analyzed.” However, the central bank considers that this is the time to face this task and start working on its technical capabilities, and advance in the development of projects directed to test different implementations of the currency.

The bank also stated it will keep consulting and maintaining an open dialogue with all the institutions in the economic area. Brazil and Mexico are other countries in Latam also working to establish their own CBDC.

What do you think about the report issued by the Central Bank of Chile? Tell us in the comments section below.

Filed Under: central bank digital currency, central bank of chile, digital peso, English, latam, News, News Bitcoin, report

Argentinian Government Advances the Creation of a National CBDC

30/04/2022 by Idelto Editor

Argentinian

The Argentinian government has taken the first steps in the launch of its own central bank digital currency (CBDC). A new decree identified the number 207/2022 gives new faculties to the Argentinian mint to involve in the investigation, development, and issuance of digital currencies. This puts Argentina on the trail of countries like Brazil and Mexico, that are already involved in the development of their e-currencies.

Argentina Prepares the Field for a CBDC

The government of Argentina is preparing the legal field for future issuance of its own central bank digital currency, the digital peso. In a decree approved and published on April 26 with the number 207/2022, the Argentinian government modified the functions and faculties of the national mint, giving it new responsibilities and possibilities.

In these new faculties, the decree includes capture and digital processing of data, images, codes, sounds, and microchips, software design and development, implementation of digital security, teleprocessing of information, printing, and/or recording of databases.

While the national mint just had the faculties to print national currency, the new decree justifies this change by stating that:

Currently, the advancement of digital environments in terms of transactions and payments… artificial intelligence and digital governance systems, as well as the emergence and proliferation of “blockchain” technology, cryptographic technologies and assets justify the update of the reach of the national mint.

To Rosendo Gravanago, legal counselor in the crypto asset area, this is a clear move in the direction of issuing a CBDC. He stated:

This gives us the pattern that Argentina is trying to get into the CBDC trend, a trend that has been adopting centralized electronic fiduciary money.

Argentinian National Exchange and Payment Platform

Also, there are other modifications to the original purpose of the organization which hints at the future establishment of a national exchange with payment processing possibilities. In this sense, the decree allows the national mint to manage and execute payments and/or collections on behalf of third parties through the use of electronic devices, transactional platforms, or any other means.

Gravanago declared to local media that:

With this regulation, the national mint is empowered to create a kind of central exchange.

These changes put Argentina in the CBDC panorama in Latam, trailing behind countries like Brazil and Mexico that are already engaged in research and development tasks related to the future issuance of their digital currencies.

What do you think about the sets that the Argentinian government is taking towards the possible issuance of a digital peso?

Filed Under: Argentina, Argentinian, CBDC, cryptocurrency, decree 207/2022, digital peso, English, national mint, News, News Bitcoin

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