2018 Singapore Fintech Festival – Lagarde Supports State Backed Crypto Currencies
This week Fintech North Director, Daniel Rajkumar attended the 3rdSingapore Fintech Festival. Attracting fintech businesses, entrepreneurs and traditional finance and tech companies from around the world, the event also included high profile key note speakers such as India’s Prime Minister Narinder Modi and Christine Lagarde, Managing Director of the International Monetary Fund.
On the last day of the festival Ms Lagarde surprised many when she announced her support of the idea of state-backed crypto currencies. The announcement is likely to be welcomed by businesses that hope to use blockchain technology in their business operations, but will not be well received by current crypto currency operators that believe that such assets should lie outside the formal financial systems, who as result might be subject to tighter regulation.
Christine Lagarde’s support of state backed crypto currencies come about through her belief that state supported currencies will reduce the negative effects of traditional payment company monopoly. Furthermore, she also believes that such crypto currencies will encourage and develop financial inclusion and provide real solutions for the more than 1bn unbanked people across the world.
Her support of state backed crypto currencies is also a step to encourage governments to take action by exploring the development of their currencies for private financial transactions ahead of the sector falling into the hands of fraudsters.
Summing up her reasons for support of this she says, “The advantage is clear. Your payments would be immediate, safe, cheap, and potentially semi-anonymous, and central banks would retain a sure footing in payments. In addition, they would offer a more level playing field for competition, and a platform for innovation. Meanwhile, your bank or fellow entrepreneurs would have ensured a friendly user experience based on the latest technologies.”
In closing Ms Lagarde, said that whilst consensus on such crypto currencies is not yet harmonised, she says that it is something that governments should be seriously exploring.
In bringing about change in new technology to the financial sector she said that companies and governments need to harness change so it is fair, safe, efficient, and dynamic.
Watch this space, a central bank backed crypto currency may be just around the corner!
