Central bank digital currency (CBDC) will be able to replace many existing stablecoins. But not Bitcoin (BTC) and other cryptocurrencies. The founder and CEO of Binance Changpeng “CZ” Zhao expressed this opinion.
In general, the appearance of CBDC will benefit the crypto industry, although, with a number of reservations, he believes.
“Today, central banks and governments are educating the masses about blockchain technology and cryptocurrencies. And guess what, you can’t learn about blockchain without learning about Bitcoin. And when you learn about Bitcoin, you learn about the valuable fundamental properties of money – scarcity, freedom to transact, and low fees”. Zhao said in the statement.
The authorities can quickly force merchants to accept CBDC
According to Zhao, the authorities can quickly force merchants to accept CBDC. Which stimulates the introduction of digital wallets and will encourage many to use cryptocurrencies.
Also, the appearance of the digital form of fiat can increase the inflow of funds to crypto exchanges, CZ added. At the same time, he stressed that CBDC differs from Bitcoin and some other cryptocurrencies at a fundamental level.
Zhao is confident that most of the Central Bank’s digital currencies will be inflationary, with restrictions on certain transactions and high fees when used.
Comparison between Bitcoin and CBDCs isn’t worth making at all
He admitted that some central banks could issue a CBDC with a limited supply, free transactions and low fees. This will reduce the demand for Bitcoin in this country, but will not displace the cryptocurrency.
It will remain the preferred means of saving. Zhao recalled that even now a certain percentage of digital gold owners do not consider it as an alternative to the currency. “So perhaps this comparison between Bitcoin and CBDCs isn’t worth making at all,” the CEO of Binance concluded.
Recall that previously, Binance signed deal with Dubai World Trade Center (DWTC) in order to create an industry hub in the emirate.