Analysts at RBC Capital Markets have suggested that stifling Facebook’s Libra may leave the field open to China’s central bank digital currency (CBDC) to dominate in emerging economies.
China shifts development of digital currency in extra gear
On Oct. 15, financial news outlet Markets Insider reported that RBC analysts believe that once Facebook announced its Libra stablecoin plans, China shifted development of its own yuan-backed CBDC into the next gear. RBC wrote to clients:
“If US regulators ultimately dismiss Libra and decide not to draft regulations to encourage crypto innovation in the US, China’s CBDC may be strategically positioned to become the de facto global digital currency in emerging economies.”
United States Treasury Secretary Steven Mnuchin recently said that firms that decided to drop Facebook’s Libra stablecoin project did so because of regulatory concerns. Mnuchin added that the Libra project is not up to par with American Anti-Money Laundering standards, saying:
