Ethereum founder Vitalik Buterin has stated that he is “not expecting to see any kind of large-scale, live central bank digital currency actually launched for another few years.” He added that “if it is, then I guarantee you that it will basically be a server with a bunch of marketing buzzwords to make it look like a blockchain.” He made the remark while participating in an October 17 panel discussion at Swell, a conference convened by blockchain firm Ripple in Toronto.
He believes that, at the moment, “there is nothing close to a central bank-issued digital currency that’s being launched because people don’t even fully understand what the economic model” associated with such an asset would look like. The fact that many central banks have been running various types of pilot programs on the Ethereum blockchain “doesn’t mean too much in practice,” he explained, because “these are ultimately all test projects.” Among the other blockchain use cases that governments are studying, he said, are revenue-tracking measures to combat corruption and a settlement coin that would operate “inside of a financial derivatives system.”
Buterin’s comments came on the heels of an announcement made by Russia’s minister of communications and mass media that President Vladimir Putin plans to develop and issue the cryptoruble. Russia is motivated to debut its state-backed cryptocurrency quickly, the minister explained, because “if we do not, then in two months our neighbors in the Eurasian Economic Community will do it.”
Other governments and central banks that are considering developing a digital currency include the United Kingdom, the Netherlands, India, and Sweden.
As Buterin indicated during the discussion, he has himself been involved in conversations with central bankers about the ways in which state and financial institutions might deploy blockchain technology.