Welcome to Tao of Chao, where we explore some of the most important topics in finance and economics. Join Philip Chao as he welcomes Elliot Hentov back for an important discussion on Central Bank Digital Currency (CBDC). Elliot is the head of macro policy research and chief geopolitical strategist at State Street Global Advisors, so he's got a unique insight into this topic. Discover why CBDCs are growing in popularity, how they differ from cryptocurrencies, and what implications they have for public policy. Watch now!
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Philip Chao
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Introducing Elliot Hentov
Today's topic: Central Bank Digital Currency (CBCD)
Current state of payment systems and fees
Credit example: current hidden or indirect fees
Definitions: digital money, currency, stable coins, blockchain, etc
Digitizing currency to reduce transaction costs
One dirty secret for digital currencies
Do digital currencies disrupt retail banking?
Inefficiencies of current financial systems
Definition: digital representations of physical things vs. the blockchain
Blockchain reduces middlemen and brokers
CBCD's roll in the blockchain — streamlining transaction settlement
Two credible digital currencies today
Efficiency and gains come from entire market transition
Naming the benefits of blockchain and CBDC
Other advantages of code-based smart contracts
Uncertainty of cross-border exchange cost savings
Understanding efficiencies of digital wallets
Do we need banks if there are central bank digital currency?
Developed markets facing privacy and constraint concerns from public
Emerging markets inverse: state control of capital
Declining relevance of physical cash
Geopolitical implications of CBCD and new financial ecosystems
Russia/Ukraine Sanctions highlight alternative financial ecosystems
The myth of dedollarization — where money is invested counts more
Good luck investing in equities without investing in the US market
Risk of fracturing of financial ecosystem due to CBCDs
Show close and disclaimer
