By Lucas Mearian<\/p>\n
Central banks in Asia and Europe are in the final stages of launching digital currencies<\/a> for future payment systems and cross-border transactions, according to a new report from accounting firm KPMG.<\/strong><\/p>\n And governments around the world see the launch of these blockchain-based\u00a0central bank digital currencies<\/a>\u00a0(CBDC) as something that could one day give them a competitive advantage in global trade.<\/p>\n \u201cIn 2020, we at KPMG expect to assist regional and central banks in the development of well-defined technology frameworks that can anchor private-sector initiatives,\u201d Arun Ghosh, U.S. Blockchain Leader at KPMG, said in\u00a0a blog post<\/a>.<\/strong><\/p>\n \u201cThe advantages are especially apparent in cross-border payments, which are costly, cumbersome, and opaque,” he said.<\/p>\n “New services using distributed ledger technology and crypto assets have slashed the time it takes for cross-border payments to reach their destination from days to seconds by bypassing correspondent banking networks.\u201d<\/strong><\/p>\n In\u00a0a blog post<\/a>, the IMF said today\u2019s fiat currencies are in flux \u201cand innovation will transform the landscape of banking and money.\u201d<\/p>\n Other countries are already looking to innovate in ways that given them an advantage.<\/p>\n China is\u00a0reportedly close to releasing a national cryptocurrency<\/a>\u00a0that, because of greater efficiencies, could challenge the U.S. dollar as the de facto currency for international trade. Other smaller countries such as Sweden are planning their own state-sponsored cryptocurrency. Sweden\u2019s would be called\u00a0the e-Krona<\/a>.<\/strong><\/p>\n And the Bank of England has\u00a0been researching cryptocurrency<\/a>\u00a0since 2015.<\/strong> Even\u00a0though it does not currently plan to issue a cryptocurrency linked to Pound sterling, it has published\u00a0extensive research<\/a>\u00a0on\u00a0the monetary policy and financial system implications of issuing CDBCs.<\/p>\n \u201cIf a central bank issued a digital currency, then everyone (including businesses, households and financial institutions other than banks) could store value and make payments in electronic central bank money,\u201d the Bank of England said in a research paper.<\/strong><\/p>\n \u201cWhile this may seem like a small change, it could have wide-ranging implications for monetary policy and financial stability.\u201d<\/strong><\/p>\n Regardless of any movement by central banks, Ghosh said, fiat-based \u2018stablecoins<\/a>\u2019 are already being issued by the private sector to support enhanced value exchange and settlement within organizations and across banking networks.<\/p>\n