Digital Currencies in the World

Looking at the contemporary world, as everything is going through digitalization, so is the money now. Digital money has the potential to simplify the present financial infrastructure, making monetary transactions faster and more affordable. It may also make it easier for central banks to execute monetary policy. So let's dive into emerging digital currencies.

What precisely is a Central Bank Digital Currency (CBDC)?

A CBDC is digital currency that a central bank backs and issues. Looking at the opportunity CBDC provides is that being centralised it can be tracked. So it provides a secure and efficient payment system. However this can be seen as a risk too as every transaction and deposit leaves a digital trail, some fear that a CBDC-enabled society will undermine people' privacy. And why is that? It's because the central bank will have complete control on it.

Stablecoin:

Now looking at Stablecoin, it's a digital asset that has its value tied to another asset class, such gold or fiat money, to reduce price volatility. Stablecoins' main benefit is that they can be used for everyday transactions since their prices don't change as much as other cryptocurrencies. Stablecoin comes with risks too. Weaker currencies nations with high inflation and weak institutions, can face risks since new types of "dollarization" might result from local currencies being abandoned thus weakening nations fiscal policy, economic development, and social prosperity.

Centralized Exchange (CEX) vs. Decentralized Exchange (DEX):

CEXs allow transactions of cryptocurrencies between buyers and sellers by offering an online trading marketplace that maintains an order book: a collection of buy and sell orders made by individual traders. CEX provides the simplest method to purchase bitcoin but at the same time it involves security risk as you give someone else authority over your money.

Whereas decentralised exchange (DEX) is concerned, DEXs are designed to provide low transaction fees, let users keep their own assets directly, and bypass some regulatory requirements as we. Moreover, user’s have to pay a fee to their liquidity providers to avoid a risk called impermanent loss.

ETF:

The value of digital currency is monitored by a Bitcoin exchange-traded fund, which trades on conventional stock markets rather than cryptocurrency exchanges.ETF is simple to invest in through the stock market however it lacks privacy which is seen as a risk since it is governed by the government.

NFT’s:

The NFT universe is not restricted to artistry, but also enables tokenization and monetization of digital content like recorded images, gaming, collections, trading cards, art, memes etc.

So it provides endless opportunities for brands to help improve their identification on platforms where companies generally have no major presence thus commercialising a company's IP’s. Nonetheless, NFT has its risks too as buyers and sellers alike are frequently victims of fraud because there is little regulation.

Blockchain in Healthcare:

Blockchain is a strong technology that allows many parties to securely share and access data. This is a major challenge in healthcare technology, where patient confidentiality and security are crucial, yet enhancing quality of treatment requires increased coordination in patient data management throughout the healthcare system and the capacity to apply analytics to population level medical data.

Indeed, early blockchain systems had shown potential to cut healthcare costs, increase data exchange among stakeholders, and expedite business operations. An emerging concept for gathering and exchanging private information might be just what the doctor prescribed to ensure that an already overburdened industry can cut extravagant expenses. Some of the prominent use case of blockchain in digital healthcare sector can be:

● Transparency in the supply chain

● E-health records centred on the patient

● Insurance and supply chain settlements using smart contracts

● Verification of medical personnel credentials

● Remote monitoring of IoT security

However some of the big issues regarding integrating blockchain in healthcare arise from certain well-known technology restrictions and characteristics of traditional public blockchains:

● Scalability and speed

● Overall openness and lack of secrecy.

Through blockchain, obstacles in healthcare such as data security can be overcome as blockchain can benefit digital health by making it simpler to securely communicate data across widely diverse healthcare systems with patient agreement. It can save time and efficiency of the healthcare system as well. So keeping in mind all the advantages and opportunities blockchain projects provide in the healthcare system it can be considered integrating blockchain in the healthcare system as it will increase the success rate and proficiency when it comes to patients.

Should Switzerland introduce Digital Franc (CBDC)?

In my opinion, Switzerland should opt for Digital Franc (CBDC) as the world is moving toward globalisation and everything is going through digitalization with great speed.

Switzerland should not be left behind in this technological development as it will provide

+them leverage in this contemporary world as they will be able to match with growing economies who are using Digital currencies for economic development etc. Quoting reason supporting the following opinion:

● CBDC might potentially aid boost efficiency in trading, settlement, and securities management.

● Increased efficiency in the interbank market .

● Will fulfil the demand of the general public for digitalization. However opting it can be a risk too:

● When an anonymously constructed retail CBDC acts as an equal complement to currency (token-based CBDC), provides extra functions, and is available to private persons and businesses indefinitely, it threatens to displace bank deposits.

● States can face strategic challenges such as cyber risk.

Decentralisedsystemcanfuelcorruption.