As new technologies reshape the global financial landscape, Wharton voices lead the discussion. Max Harris, senior fellow at the Wharton Initiative on Financial Policy and Regulation (WIFPR), recently served as Project Director for the Group of Thirty’s (G30) new report, “The Past and Future of Money: New Technologies and Economic Risks.”
Harris joined Harvard’s Kenneth Rogoff and a distinguished group of financial leaders to examine how innovations like cryptocurrencies, stablecoins, and central bank digital currencies (CBDCs) are transforming the world of payments and money.
The study proposes three key recommendations:
- Policymakers should prioritize exploring wholesale CBDCs to maintain the role of central bank money in large-scale payments.
- Policymakers should also encourage efforts to tokenize commercial bank deposits, allowing the benefits of tokenization within the existing banking regulatory framework.
- Policymakers should develop a strong regulatory framework for stablecoins, fostering competition in payments while safeguarding the stability of the broader financial system, while not exacerbating tax evasion and money laundering.
“The history of money is a history of transformation,” Max Harris elaborated in a recent press release. “Today, the monetary system is again at an inflection point, with blockchains and tokenization offering new opportunities and risks. As policymakers consider the future of money, they should keep these earlier transitions in mind.”
Harris continued, “Technologies might change, but the principles of finance remain the same. Bad money is bad, whether analog or digital, and can threaten financial stability and the broader economy. Money needs to be trusted and secured by a strong legal framework to be good. During this time of rapid change, policymakers must ensure that the system remains underpinned by safe, trusted forms of money.”
View the full report, “The Past and Future of Money: New Technologies and Economic Risks” on the Group of Thirty’s website.
Watch the webinar launching the report above or on YouTube.
Learn more about Max Harris.
Visit WIFPR’s website.