cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start
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cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start [2022/04/27 03:01] nick |
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| ====== Question: 06. Could a CBDC adversely affect the financial sector? How might a CBDC affect the financial sector differently from stablecoins or other nonbank money? ====== | ====== Question: 06. Could a CBDC adversely affect the financial sector? How might a CBDC affect the financial sector differently from stablecoins or other nonbank money? ====== | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:start| Return to CBDC Benefits, Risks, and Policy Considerations ]] | + | |< 100% >| |
| + | | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:start| Return to CBDC Benefits, Risks, and Policy Considerations ]]\ | <WRAP> | ||
| + | <html><b> | ||
| + | <a href="mailto:[email protected]?Subject=OMG's CBDC WG Response: | ||
| + | Question: 06. Could a CBDC adversely affect the financial sector? How might a CBDC affect the financial sector differently from stablecoins or other nonbank money? | ||
| + | ">Provide Feedback</a></b> | ||
| + | </html> | ||
| + | </WRAP> | | ||
| ===== Question ===== | ===== Question ===== | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] | + | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] |
| - **Could a CBDC adversely affect the financial sector?** | - **Could a CBDC adversely affect the financial sector?** | ||
| Line 10: | Line 17: | ||
| ===== Answer ===== | ===== Answer ===== | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] | + | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] |
| ==== Overview ==== | ==== Overview ==== | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] | + | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] |
| To answer the question it is important to first define what is meant by [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:f:financial_sector | Financial Sector]], [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:f:financial_market | Financial Market]] and [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:c:clearing_house | Clearinghouse]] | To answer the question it is important to first define what is meant by [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:f:financial_sector | Financial Sector]], [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:f:financial_market | Financial Market]] and [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:c:clearing_house | Clearinghouse]] | ||
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| <figure financialSrveComp> | <figure financialSrveComp> | ||
| - | {{ :cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:screen_shot_2022-04-25_at_4.56.55_pm.png?500 |}} | + | {{ cbdc:04_doc:20_comments:brp:q06:screen_shot_2022-04-25_at_4.56.55_pm.png?500 |}} |
| <caption>The Composition of the Financial Services</caption> | <caption>The Composition of the Financial Services</caption> | ||
| </figure> | </figure> | ||
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| <figure FinancalMrkts> | <figure FinancalMrkts> | ||
| - | {{ :cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:screen_shot_2022-04-25_at_5.15.53_pm.png?500 |}} | + | {{ cbdc:04_doc:20_comments:brp:q06:screen_shot_2022-04-25_at_5.15.53_pm.png?500 |}} |
| <caption>The Composition of the Financial Maket</caption> | <caption>The Composition of the Financial Maket</caption> | ||
| </figure> | </figure> | ||
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| <figure clearingHouse> | <figure clearingHouse> | ||
| - | {{ :cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:screen_shot_2022-04-25_at_5.55.31_pm.png?500 |}} | + | {{ cbdc:04_doc:20_comments:brp:q06:screen_shot_2022-04-25_at_5.55.31_pm.png?500 |}} |
| <caption>The relationship between a buyer, a seller and a Clearinghouse.</caption> | <caption>The relationship between a buyer, a seller and a Clearinghouse.</caption> | ||
| </figure> | </figure> | ||
| ==== 1. Could a CBDC adversely affect the financial sector? ==== | ==== 1. Could a CBDC adversely affect the financial sector? ==== | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] | + | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] |
| === Technically === | === Technically === | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] | + | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] |
| - | Each of the **Financial Sector** components will respond differently to the use of a U.S. CBDC depending on how much they want to support the use of CBDC as an alternative to the approved Clearinghouse. The Financial Sectors normally using U.S. Dollars on both sides of a transaction could use something like the [[cbdc:private:cbdc_omg:04_doc:15_common:70_dualnets:start | ACH/CBDC network proposal]] ( see Figure {{ref>simpleCbdcFlow}}. This should require a minimum of change in their current processes and require them to be able to hold U.S. Dollars and U.S. CBDC in the pertinent accounts. The main benefit of using a CBDC Network should be the increase in speed (almost real-time) for settlements since the U.S. CBDC will use an automated [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.k_consensus:02_mechanism:start | Consensus Mechanism]]. However, in order to check for Privacy and Criminal Activity by enforcing the [[cbdc:private:cbdc_omg:04_doc:15_common:45_privacy:start | National Privacy Concerns]] and[[cbdc:private:cbdc_omg:04_doc:15_common:48_natsec:start | National Security Conncerns]] as well as respecting [[cbdc:private:cbdc_omg:04_doc:15_common:50_international:start | International Concerns]], the Consensus process most likely needs to be extended to help enforce the existing laws and regulations. This extension could rely heavily on the use of [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:a:ai | Artificial Intelligence (AI)]] and [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:i:intelligent_agent | Intelligent Agents]]. | + | Each of the **Financial Sector** components will respond differently to the use of a U.S. CBDC depending on how much they want to support the use of CBDC as an alternative to the approved Clearinghouse. The Financial Sectors normally using U.S. Dollars on both sides of a transaction could use something like the [[cbdc:public:cbdc_omg:04_doc:15_common:70_dualnets:start| ACH/CBDC network proposal]] ( see Figure {{ref>simpleCbdcFlow}}. This should require a minimum of change in their current processes and require them to be able to hold U.S. Dollars and U.S. CBDC in the pertinent accounts. The main benefit of using a CBDC Network should be the increase in speed (almost real-time) for settlements since the U.S. CBDC will use an automated [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.k_consensus:02_mechanism:start | Consensus Mechanism]]. However, in order to check for Privacy and Criminal Activity by enforcing the [[cbdc:public:cbdc_omg:04_doc:15_common:45_privacy:start| National Privacy Concerns]] and[[cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:start| National Security Conncerns]] as well as respecting [[cbdc:public:cbdc_omg:04_doc:15_common:50_international:start| International Concerns]], the Consensus process most likely needs to be extended to help enforce the existing laws and regulations. This extension could rely heavily on the use of [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:a:ai | Artificial Intelligence (AI)]] and [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:i:intelligent_agent | Intelligent Agents]]. |
| <figure simpleCbdcFlow> | <figure simpleCbdcFlow> | ||
| - | {{ :cbdc:private:cbdc_omg:04_doc:15_common:70_dualnets:screen_shot_2022-04-20_at_2.53.28_pm.png?700 |}} | + | {{ cbdc:04_doc:15_common:70_dualnets:screen_shot_2022-04-20_at_2.53.28_pm.png?700 |}} |
| <caption>Theoretical Very Simplified Dual ACH-CBDC Network Concept.</caption> | <caption>Theoretical Very Simplified Dual ACH-CBDC Network Concept.</caption> | ||
| </figure> | </figure> | ||
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| === Reputation === | === Reputation === | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] | + | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] |
| - | Obviously, if there is a breach or hack in the U.S. CBDC, all the **Financial Sector** components would be affected. See the existing [[cbdc:private:cbdc_omg:04_doc:12_summary:start#risks | Risks]] identified in the **White Paper** and the response to [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q11:start]]. | + | Obviously, if there is a breach or hack in the U.S. CBDC, all the **Financial Sector** components would be affected. See the existing [[cbdc:public:cbdc_omg:04_doc:12_summary:start#risks| Risks]] identified in the **White Paper** and the response to [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q11:start]]. |
| ==== 2. How might a CBDC affect the financial sector differently from Stablecoins or other nonbank money? ==== | ==== 2. How might a CBDC affect the financial sector differently from Stablecoins or other nonbank money? ==== | ||
| - | [[cbdc:private:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] | + | [[cbdc:public:cbdc_omg:04_doc:20_comments:brp:q06:start| Return to Top]] |
| - | There is an entire section on Stablecoin. See section [[cbdc:private:cbdc_omg:04_doc:15_common:30_stablecoins:start]]. | + | There is an entire section on Stablecoin. See section [[cbdc:public:cbdc_omg:04_doc:15_common:30_stablecoins:start]]. |
| Currently, Stablecoins and nonbank money need to be converted to U.S. Dollars in order for the money to be used within the financial sector. | Currently, Stablecoins and nonbank money need to be converted to U.S. Dollars in order for the money to be used within the financial sector. | ||
cbdc/public/cbdc_omg/04_doc/20_comments/brp/q06/start.1651042906.txt.gz · Last modified: 2022/04/27 03:01 by nick
