HUSTLE MAG MARCH 2020 FINAL

opinion
CRYPTOCURRENCY
By Prof. Bitange
Ndemo
A stable
coin will
change the
dynamics
and force
banks to
move into
digital
lending
for greater
inclusivity
16
HUSTLE EAST AFRICA
Cryptocurrencies gaining
acceptance
The United States Federal Reserve Bank
recently gave the clearest sign yet that it
will develop its own digital currency. The
announcement pushed the value of the
bitcoin beyond the $10,000 mark up from
$7,179 in December 2019.
Federal Reserve Bank Chief Jerome Powell told
Congress that the Bank’s view on a digital dollar
was overdue considering the fact that Facebook’s
Libra came as a “wake-up” call and that the US
digital currency could come “fairly quickly.”
He added that the issue of digital currencies was
becoming “systematically important” even though
there are still “many questions that need to be
answered around digital currency for the United
States.”
The type of cryptocurrency that governments
prefer to create is sometimes referred to as central
bank-backed digital currency or state-issued digital
currencies. In some cases, they are simply known as
stablecoins.
These types of cryptocurrencies are designed
to minimize the volatility of the price that is often
common with other coins that are not pegged on,
for example, fiat money or some assets. They can
take the form of national currency.
After several years of dilly dallying on the issue
of digital currency, congress seemed to be putting
pressure on the Federal Bank Chief to move with
speed in implementing a central bank backed dig-