Blockchain technology is here to stay. And it is that, after being only a cult object for privacy enthusiasts. Blockchains have become one of the most important technologies in the world in recent years. Leading that even governments seek to enter this sector by launching their own digital assets. Therefore, during the European Blockchain Convention, government virtual currencies and their effects on the crypto world were discussed.
What are government virtual currencies?
When Bitcoin first saw the light eleven years ago, virtual currencies seemed to be a simple curiosity. After all, the idea of a currency that does not exist in the physical world and is also managed by its own users, seems far-fetched in the midst of a financial system dominated by traditional fiat money.
However, the passage of the years has shown that not only cryptocurrencies, but Blockchain technology as a whole, has immense potential in practically all sectors. Which has led to a substantial increase in the adoption of crypto assets. And to the use of blockchains by companies and private organizations.
Due to this, governments have started a race to enter the crypto market, designing virtual currencies that offer the advantages that cryptocurrencies have for the execution of financial transactions. While maintaining control over them from the central banks.
Thus, great powers such as China have announced the next launch of their own virtual currency. While other countries such as Russia, the United States and France are studying the possibility of launching their own government virtual currencies, with which to increase the efficiency of their financial systems.
Good for the crypto world?
Despite the fact that government virtual currencies were born with the aim of facing the advancement of cryptocurrencies. Ensuring that governments maintain control over the global financial system. The truth is that the vision of the members of the crypto community about these products is not homogeneous.
Therefore, in a panel of the European Blockchain Convention today, the Head of Policy and Communications of the Libra Association, Dante Disparte, assured that for him the government virtual currencies are a positive development. Since, these financial products would serve to make international transactions more efficient, and therefore increase the ease with which people can manage their money.
This is not the position of the Chief Operating Officer of the Dash Core Group, Robert Wiecko, who together with the CEO and founder of Adhara, Julio Faura, highlighted the problems that this model of government digital assets has. Especially due to the excessive centralization to which government virtual currencies would be subjected.
And it is that, unlike cryptocurrencies, where users are absolute owners and responsible for their own money. Government virtual currencies depend on the country’s central bank. So, ultimately, users are stripped of control over their money, which remains in the hands of their government. Which, for Wiecko and Faura, is a return to the problems that lie at the core of traditional fiat money.