In a detailed report, MIT pointed out what can be learnt from existing cryptos and what CBDC should not feature.
“CBDC should not be a direct copy of existing cryptocurrencies with exactly the same design and features but there are things we can learn from their emergence — the usefulness of programmability in money and the importance of preserving user privacy.”
Highlighting the crossroad of finance and technology, the MIT group pointed out that advancement in electronic value transfer technology has staggered behind the increasing expectation for a computerized payment system, as moderately seen in the e-commerce industry.
The crypto domain became a reality mainly due to need, according to MIT research team. It was also pointed out that crypto sector has seen considerable trials and failures so far, but forced governments across the world to study about the prevailing state of fiat money.
In the crypto domain, awards from almost anyone is permitted often, thereby transforming it as an open platform for innovation and counterbalance to a certain degree, while also promoting competition in the market.
The group wrote “The cryptocurrency ecosystem should be viewed as a laboratory where developers are inventing different technologies, monetary policies, governance strategies, and reward systems which are competing.”
“The space is still in its infancy, but make no mistake — successful ideas from this area will eventually find their way into the more conservative world of fiat digital payments.”
The report enumerates many critical aspects of the distributed ledger and crypto sector, including but not limited to decentralized blockchain consensus covenant, “Atomic cross chain transactions as an example of programmable money,” and blockchain-based anonymity.