CEO of Citigroup, Michael Corbat, has said that the multinational bank is helping governments around the world to develop sovereign digital currencies or CBDCs. In an interview with Bloomberg’s David Rubenstein, Corbat emphasized that CBDCs are inevitable and the banking giant is helping in developing them. However, the CEO did not mention the governments the company is helping to create the central bank digital currencies. Citigroup Helping Governments Develop Digital Currencies CBDCs are similar to cryptocurrencies, although they are centralized and pegged to a fiat currency. CBDCs comes at the intersection between cryptocurrencies and cash payment systems, making payments speedier while helping to manage transaction records and prevent crimes. Corbat’s comment comes amid central banks around the world gearing up to develop their own central bank digital currencies: “We’ve been working with governments around the world in terms of the creation and commercialization of them and I think that’s inevitable that it will be coming.” Central banks such as the European Central Bank and the U.S. Federal Reserve have all looked into developing their own central bank digital currencies. However, a proper launch plan on digital currencies has not been initiated. Meanwhile, China has already trialed its state-backed digital currency. Citigroup Is the Lastest Private Firm to Develop CBDCs In 2017, Corbat remarked that central bank digital currencies will emerge as a response to the threat posed by Bitcoin. Although Corbat did not mention any particular cryptocurrencies or digital assets in the interview, he did say: “some of these currencies will just be continued alternatives, continued different sources of payment that people can take advantage of depending on the underlying nature of what they are.” Citigroup is the latest private company to help develop central bank digital currencies. Earlier this year, private firms such as Visa and Mastercard had both launched CBDC initiatives.
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