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Ripple CTO Says There Won’t Be One World Fiat Currency “Any Time Soon”

u.today 20 October 2020 20:00, UTC
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In a series of recent tweets, Ripple CTO David Schwartz has opined that the role of the U.S. dollar as the world’s settlement currency is now shrinking.

However, he’s convinced that a single fiat or digital currency will not take its place any time soon:  

“I don't think there's going to be one world fiat any time soon, so even with stablecoins there will be a lot of them.”

No global stablecoin

Last week, the G20 Financial Stability Board (FSB) published a roadmap for cross-border payments, highlighting where it recognizes the advantages of stablecoins while also assessing their risks.

The G20 members are working closely with International Monetary Fund (IMF), the World Bank and other major financial organizations to develop a regulatory framework for central bank digital currencies (CBDCs).

As reported by U.Today, Agustín Carstens , general manager of the Bank for International Settlements (BIS), also called for tight cooperation between different central banks during a an Oct. 19 conference hosted by the IMF.  

While this concerted effort means could potentially mean that a global stablecoin is in the works, Schwartz states that there will not be one asset to rule them all.

“I think lots of digital and fiat assets will compete to play that role and there is room for more than one. I see the dollar's role as the world's settlement currency slowly shrinking and international commerce increasing”

There has to be a bridge

Schwartz also mentions that there a need for “a neutral, jurisdictionless” asset that will serve as a bridge for CBDCs and other types of stablecoins.

This is where XRP, Stellar (XLM), and other cryptocurrencies come into play. In today’s Berkeley speech, Schwartz makes it clear that he doesn’t expect XRP to be the only network that handles all payments:    

“The XRP Ledger can't handle all the world's payments, and I'm not proposing a "one network" solution. That's totally unrealistic. People want different things and have different problems. But XRP can be the hub or backbone that provides the fast international settlement piece.”   

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