Digital currency: Could the role of national banks diminish?

The world of finance is rapidly evolving with the rise of digital currencies, and the role of national banks is being called into question. Private companies and central banks are in a race to develop their own digital currencies, leading to concerns about the potential diminishing role of national banks in some weaker economies. CNBC Africa recently spoke to Abraham Banaddawa, the Founder of Utilis Ventures, to gain insight into this intriguing shift. Banaddawa highlighted the competition between central banks and tech giants like Facebook and Amazon in the digital currency space, emphasizing the importance of positioning and building use cases to remain relevant. He also raised concerns about the influence of China's digital currency and its potential impact on African economies. Banaddawa urged African countries to take proactive steps in developing their own central bank digital currencies to ensure competitiveness and financial sovereignty in the digital economy. While challenges such as slow legislation and pushbacks exist, he emphasized the need for collaboration between governments and the private sector to drive innovation and shape the future of digital currency in Africa. As the world transitions towards digital currencies, the role of national banks is at a critical juncture, requiring strategic decisions and swift action to adapt to the evolving financial landscape.