The Governor of the Bank of Ghana, Dr Ernest Addison, has said within the Ghanaian payment and financial ecosystem, the rapid adoption of digital financial technology, technological innovations, increasing interconnectedness among payment service providers and banks and the existence of an enabling regulatory environment has stimulated the growth and participation of non-banks financial institutions within the payment and financial ecosystem.
The participation of these entities to offer exciting digital technologies to meet customers’ derived demand for safe, convenient and reliable digital financial products and services is overwhelming, Dr Addison indicated.
Discussions, he said, on the future of money and how the digital revolution is impacting on currencies and the financial sector would be deemed incomplete without some remarks on the emergence of crypto currencies.
“The advent of digitisation also witnessed the emergence of a fully decentralized digital asset in 2009.
“Subsequently, he said there have been over 2000 newly issued crypto-assets with unique characteristics which include amongst others; a distributed ledger technology (blockchain), anonymous issuers and are not denominated in sovereign or fiat currency.
“Despite several recommendations by academia and industry watchers for Central Banks to leverage on existing and newer technologies to issue digital currencies as alternatives to banknotes, few countries have actually introduced CBDC with most countries in exploration stages.
“The rapid decrease in the use of bank notes and coins coupled with a less fully developed infrastructure to support the issuance of banknotes have invigorated interest in policy makers and financial sector authorities in the introduction of CBDC.
“Despite the excitements that surrounded its adoption and potentially a replica for central bank fiat currency, high price volatility makes these crypto assets such bitcoin unattractive as a mean of payment. Crypto assets continue to remain essentially speculative and attractive to smaller unit of investors.
“The use of any privately issued form of currency generally lack a strong consumer-base needed to create the network externalities which is capable of dethroning a fiat currency or legal tender,” Dr Addison said in a statement read on his behalf at an event organized by the Institute of Chartered Accountants.