The rise and risk of private digital currencies

The rise and risk of private digital currencies

Monica Singer is the creator of opportunities at ConsenSys, a US-based blockchain software technology company

I am concerned that central banks are so worried about protecting commercial banks that they don't realise that the risk of inaction is greater than that of embracing innovation. The real risk comes from private companies that are in the process of issuing payment mechanisms that might entice depositors to never again have to use a legacy bank as they exist today.

A shift to the use of private digital currency or "stablecoins““”currency collateralised by fiat, cryptocurrencies, gold,  an algorithm or combination of financial instruments“”could result in less use of fiat currency (currency issued by a central bank). Once this takes place, central banks will lose their ability to affect monetary policy and all their supply and