Ben Bernanke, the former federal reserve chairman of the United States acknowledged at Ripple’s Swell conference that blockchain has clear benefits with regards to improving the flow of money around the globe, citing that conventional bank transfers are costly and slow.
Former federal reserve chairman Ben Bernanke.
Image license: Public domain (Wikipedia).
“It’s an obvious area where new technologies like blockchain or these electronic currencies can be used to improve the process.”
He also mentioned Ripple, stating that any effort to bring the world closer together and reduce the cost of payments/improve reliability is a good thing. However, he didn’t mince words when he said that governments would take whatever steps they can to eliminate Bitcoin, citing that it is intended to circumvent regulations and government intervention.
Bernanke has commented on Bitcoin repeatedly over the years, stating that it’s anonymity presents serious problems for governments. While it’s not likely that Bitcoin is just a ploy for criminals to hide their transactions, the level of privacy it offers benefits everyone.
Bernanke also pointed out that blockchain technology has raised the interested of central banks, despite the fact that it is more ‘anonymous’ than fiat currencies. This is partly due to the fact that it may help to ameliorate the cost of international transfers, and can provide inspiration for the creation of their own digital currencies.
Governments that have taken an interest in blockchain include (but are not limited to) those in Singapore, the United Kingdom, Jamaica, Europe, and Russia. The Russian government doesn’t sound particularly fond of Bitcoin or blockchain, but is reportedly interested in creating its own national cryptocurrency.
Regardless of whether governments adopt common cryptocurrencies for cheaper international transactions, or they create their own, the benefits would still be significant, as exchanges can swap out one cryptocurrency for another in a matter of minutes, and at a low cost.