European Central Bank bets on CBDC over BTC for cross-border payments
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European Central Bank bets on CBDC over BTC for cross-border payments
A recent study by the European Central Bank (ECB) on identifying the ultimate cross-border payment medium crowned central bank digital currencies (CBDCs) as the winner against competitors, including banking, bitcoin (BTC) and stablecoins. Are included. The ECB's interest in identifying the best cross-border payment solutions stems from the fact that it acts as the central bank of the 19 EU countries that have adopted the euro.
The study, "Towards the Holy Grail of Cross-Border Payments," referred to bitcoin as the most prominent non-backed crypto asset. A recent study by the European Central Bank (ECB) on identifying the ultimate cross-border payment medium crowned central bank digital currencies (CBDCs) as the winner against competitors, including banking, bitcoin (BTC) and stablecoins.
Are included While the study highlighted Bitcoin’s inherent scaling and speed issues, it failed to consider the timely upgrades — Taproot and Lightning Network — that improve the network performance, concluding that"The underlying technology (and especially its 'proof-of-work' layer) is inherently expensive and wasteful."
On the other hand, the ECB recognized CBDCs as a better fit for cross-border payments due to their greater compatibility with foreign currency exchange (FX) conversions. Two major benefits have been highlighted in this regard, the protection of monetary sovereignty and the ease of immediate payments through intermediaries such as central banks.