Who Will Win the CBDC Race – Project Inthanon, Digital Lira/Yuan or? BiKi’s Ethan Ng Gives His Take

Implementing a CBDC (Central Bank Digital
Currency) is not without its corresponding risks, challenges and costs. Yet,
with the pace of digitization in the enterprise and business worlds escalating
faster than ever today, money and payments have been one of the areas most
challenged by innovation. What other factors are spurring countries today to
consider implementing CBDCs?

A global crypto exchange that has been
implementing globalization and/or expansion drives the past year in Southeast
Asia, Asia, the Middle East, Latin America and the Western regions, BiKi.com has been
studying the market conditions of each region intently. Ethan Ng, CEO of BiKi.com SEA, gives his take on the current
development of CBDCs in Thailand, China and Turkey.

Q: First of all, do you think CBDCs are a growing trend?

A: Most definitely. The interest in this area has been growing ever since
Libra was announced and more recently with Christine Lagarde from ECB pushing
for the bank’s active involvement in the development of a CBDC.I believe the rise of central bank digital
currencies will have a significant impact on the future financial ecosystem.

Q: So which country do you think will launch a working CBDC first?

A: I noticed a lot of discussion in Thailand by many KOLs, regulatory
officials and local Thai exchanges about Project Inthanon. Launched over a year
ago in 2018 by the Bank of Thailand, Project Inthanon is already in its third
phase.

And being that Thailand is so well-regulated,
with exchanges, projects and the crypto media all working closely with and
being regulated by the government, I believe Project Inthanon has one of the
highest potential to be the first successful CBDC.

Q: We have been hearing a lot about China’s CBDC development. Care to
comment on that?

A: With our BiKi research lab, incubator and fund still located in China,
we have been paying close attention to the latest news on China’s CBDC.

China is not one to shy away from innovation. It
has one of the fast-growing markets with an ecosystem of their own. Since
the Chinese CBDC will not be directly consumer-facing, it will marry well with
Chinese cryptocurrency censorship for consumers, yet thrive on a larger B2B
level.

Q: What kind of outcome will that have for China?

A: The outcome is a blockchain-driven tech country, with the average joe
benefiting from the technology but steered away from investment risks and scam
coins which are especially rampant in the Chinese industry.

Q: While all that sounds great, wouldn’t we be losing the essence of
blockchain, which is decentralization?

A: The essence of blockchain might be lost but the upside is that
governmental regulations can protect digital currency users. This will lower
the barriers to entry for newcomers to the technology, which is a good
thing when it comes to mass adoption.

Q: Where else do you think you will see widespread development of CBDCs?

A: Economies which are not thriving, for example the Turkish economy. The
digital Lira is meant to alleviate Turkey’s economic crisis amidst mounting
debt. Many Turkish are also turning to cryptocurrencies due to the volatility
of their own currency. Hence, the government plans to expedite the release of
Digital Lira, presumably by the end of 2020.

They have real world use-case scenario plans for
their CBDC. The citizens need it. And with their close ties to Dubai, it looks
like these two middle eastern states will be headed for a full crypto region
once these infrastructures are unveiled.

Q: What impact do you think CBDCs will have on Bitcoin?

A: If Central Bank Digital Currencies (CBDCs) are rolled out by 2020 in
countries such as China, the European Union, etc, we can expect that Bitcoin
prices will go beyond the $20,000 price range.

This is likely because the roll out of CBDCs
will increase adoption from mainstream players such as institutions, MNCs and
SMEs in the market. These changes will have tangible impact on the everyday
lives of the masses.

Against such a landscape, there will be an
increasing acceptance amongst non-crypto believers as they witness more and
more familiar brand names adopting blockchain technology or developing their
own stablecoins. Already, Walmart and IBM are examples of mainstream
enterprises who have adopted blockchain technology while financial institutions
like JP Morgan Chase and Signet are some of the big names in finance who have
developed their own stablecoins.

Q: What about other cryptocurrencies in general? How do you think they
will fare against CBDCs?

A: As BTC is the leader in the
tokens market, when its value increases, the altcoins will in general also
follow suit. With the upsurge of mainstream attention, more
discussion amongst regulatory bodies worldwide, the increasing utility of
tokens especially in nations where local currency is volatile, a rise in demand
for digital currencies and cryptocurrencies alike will ensue, sparking off a
new wave.

Q: Any last words?

A: In conclusion, it looks like there will be a race for countries to top
one another in being the first to issue a fully functional CBDC, plugging in
the gaps in their current national currencies.

Ultimately, it will make the world much more
connected financially, and more accountable to their assets.

Thanks to Mr Ethan Ng for his insights on CBDCs.