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South Korea’s central bank, the Bank of Korea (BOK), released a surprisingly supportive report on cryptocurrencies on the role that cryptocurrencies could play in the nation’s economy in the future, and wonders if bitcoin (BTC ) and altcoin could ‘replace fiat currencies’ in the coming years.

re were also some possible words of encouragement for stablecoin developers and decentralized finance (DeFi) advocates.

BOK published a report on August 8 entitled ” Potential for a Paradigm Shift in the Financial Sector Driven by Digital Innovation” (literal translation). In the paper, the BOK researchers predicted that cryptocurrencies will continue to be of interest to the private sector in the future, where they will operate as a vehicle for ‘investment and speculation’, and concluded that BTC and the like would probably not completely eliminate with fiat in the future, mainly due to volatility issues.

authors noted that cryptocurrency will continue to see more ‘limited purpose’ adoption in the private sector, however, where its functionality would develop separately from fiat currency.

For SBS and Segye Ilbo, the authors of the BOK report wrote,

” concern is whether private crypto assets like bitcoin can replace the role of fiat currency in the future.”

Using a familiar argument, they argued that digital assets could become a form of “digital gold” and gain common acceptance as a hedge against inflation.

Read also Tether fined by regulators for lying about Fiat reserves

On the role of stable coins, the authors wrote:

“Among cryptocurrencies, stablecoins, designed to maintain a stable value by pegging to fiat currency, will have high potential for use in cryptocurrency ecosystems, virtual and metaverse worlds, as well as cross-border remittance scenarios.”

report is not a political document, but represents the views of at least some of the BOK staff.

authors also cited the growing interest in DeFi, an industry sector they also claim is growing, and wrote that while mainstream financial firms will continue to be most people’s go-to resource for ‘general transactions’, the role of DeFi, which is more specialized «Can continue to grow» .____ To find out more: – Dismantling the 4 great myths about bitcoin promoted by central banks in 2021 – Lack of knowledge is more important than volatility for beginners in cryptocurrencies

– Some central bankers show interest in Bitcoin; Inflation Fears Grow – CBDC: A Solution in Search of a Problem?

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