The introduction of digital currencies is inevitable.
Bill Winters, Chairman of the Board of Directors of Standard Chartered Plc, gestures during a Bloomberg Television interview in London, UK on Thursday July 4, 2019.
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SINGAPORE – The widespread creation and adoption of digital currencies is “absolutely inevitable” as the international payments system evolves rapidly, according to Standard Chartered’s CEO.
At the Singapore FinTech Festival, Bill Winters said there is scope for both government-backed electronic and private currencies.
“I think there is absolutely a role for central bank digital currencies as well as non-central bank sponsored digital currencies,” said the CFO on Monday.
Standard Chartered will announce more news “in this direction” in the coming days, he added.
A push to digital
Governments around the world have already started experimenting with digital currencies, which proponents say enables more seamless money transfers. China leads the way in this regard after launching public trials of its digital yuan.
In the meantime private companies have got involved. The Facebook-backed Libra – recently renamed Diem – is among those names working on an alternative currency that could behave like the U.S. dollar.
However, Winters said the biggest opportunity for digital currencies could be in new niche segments that don’t replicate existing fiat currencies.
“The really interesting development for me,” he continued, “is to have currencies that in and of themselves do not correspond to a currency, but are supposed to capture a superset of a subset.”
Digital currencies could be created for certain types of projects, such as trading in the voluntary carbon market, Winters suggested. This would give users looking to offset their carbon emissions with confidence that the funding behind their project will be “verified, standardized, monitored,” he said.
“These types of digital currency applications and the creation of a digital currency ecosystem cannot be replicated by fiat currency or, most likely, central bank digital currency in the near future.”
A kind of network that is put together but centered on the central bank’s digital currencies is becoming a reality.
“I think there is a whole new world that is opening up for us,” he said.
Winters spoke as part of a panel at the annual conference, which this year will take place over practically five days. He was joined by Piyush Gupta, CEO of Singapore-based DBS Bank, and Calvin Choi, Chairman and CEO of AMTD Group, who both agreed that the adoption of digital currencies will likely require public and private collaboration.
“You will find in the next few years that some kind of network that is interconnected but focuses on the central bank’s digital currencies is becoming a reality,” said Gupta.