Piyush Gupta, the chief executive officer (CEO) at DBS Bank, says cryptocurrencies like Bitcoin will continue to grow as a meaningful store of value, just like gold. However, he also thinks that cryptocurrencies will not take over the role of state-backed currency.
DBS’ Piyush Gupta Considers Crypto As A Store Of Value
In the DBS Bank’s annual report released on Wednesday, DBS Holding CEO Piyush Gupta said private digital coins like Bitcoin can be a store of value as they can be saved, retrieved, and exchanged at a later time, just like gold.
Considering the regulatory and political approach, he said:
“Regulators and politicians will be reluctant to give up control of monetary policy and economic management tools, and will therefore be very cautious about letting private money grow. Having said this, I do think that private money (crypto) will continue to grow as a meaningful store of value, much like gold is today.”
The global bank’s chief does not see privately-issued digital coins taking over the role of state-backed money.
“The reason for this is that money needs to have three attributes: be a unit of account, a medium of exchange and a store of value. Privately-issued coins find it hard to attain the first two of these,” he explained.
Privately-issued coins find it hard to attain the first two of these, according to Gupta, as reasons include a lack of ubiquity, absence of faith in the issuer, and large volatility in value, among others.
CBDCs Set To Become More Prevalent
Moreover, Gupta said central bank digital currencies (CBDCs) will become more common and there’s a need to stay close to these developments. Since 85% of central banks in the world are either currently studying or piloting it, the direction of travel seems clear.
DBS is participating in industry sandboxes and experimenting with the central bank digital currency in association with the Monetary Authority of Singapore, Gupta added.
Countries such as China, the U.S., Russia, Brazil, Australia among others are already experimenting, studying, and piloting CBDC projects.
