In a panel discussion on economic institutions organized yesterday during the Annual Conference of Executive Directors (CADE), Giulio Velardi, President of the Central Reserve Bank of Peru (BCRP) explained that the country is making progress in creating a digital monetary system that will make it possible to meet the challenges emerging in The world of money.
Peru wants to develop its own central bank digital currency “CBDC”:
According to the comments published On Twitter, the head of the central bank explained that the country had managed to overcome the challenges brought by the coronavirus pandemic, but that they strategically felt the need to innovate in the way they approach finances.
Velardi explained that the Peruvian government is currently working on its own CBDC with the support of other countries that are already becoming more advanced in this regard.
However, Valverde said they are not yet ready to implement this type of financial solution any time soon despite the developments. He went on to explain:
There are many important projects for the payment system, but this is premature.
We’ve worked on a digital currency, and we’re with India and Singapore.
This will be the currency that will prevail in the future, and we do not want to be left behind.
Despite talk of preparation and development, CBDC may be closer than expected.
According to the data published byReuters“The country could be ahead of other governments that already have some level of proven progress.
Quoting from Valverde’s post:
We won’t be the first, because we don’t have the resources to be first and take those risks, but we don’t want to be left behind.
At least we are on the same level or perhaps even further behind our peers of the same size, even though we are behind Mexico and Brazil.
The race to develop CBDC in Latin America and the Caribbean:
A central bank digital currency is a copy of a fiat currency issued by a central bank with a non-physical digital expression.
Different types of technology can be used to build them, although the newest and most popular technology is the blockchain.
For example, France is already testing a CBDC using the Tezos blockchain.
In contrast, China has its own digital currency, which is almost ready and does not use blockchain technology.
In Latin America and the Caribbean, many countries are in the advanced stages of implementing or developing a CBDC.
In addition to Mexico and Brazil (which have promised to implement for next year), the Bahamas already have a digital currency in circulation.
Meanwhile, DCash is already being used as a joint CBDC between Antigua, Barbuda, Grenada, Saint Kitts, Nevis and Saint Lucia.
El Salvador does not have a CBDC, but there are rumors that politicians close to President Bukele are working on his proposal in addition to the fact that Bitcoin is legal tender.
Similarly, Venezuela has a “digital bolivar” in addition to its official cryptocurrency, Petro.
So Peru will have to work hard to catch up if it is true that it does not want to be left behind.
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