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BWC Digital Finance Project Team Brief I Press Release
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2022-04-22_DFPT_Brief_I.pdf13.38 MB
Fri, Apr 22, 2022
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FOR IMMEDIATE RELEASE (Washington, DC – April 22, 2022) - The Bretton Woods Committee is pleased to announce the release of our newest publication: “State of Play in Crypto Markets: Opportunities and Dangers.”
Published by our Digital Finance Project Team (DFPT), this brief is the first in an eight-part series that will explore the critical regulatory and policy issues of digital assets and the crypto market. The DFPT is a subgroup of BWC’s Future Finance Working Group (FFWG), a multisectoral group of leaders charged with evaluating emerging trends, opportunities, and ideas within the realm of global finance.
The use of digital currencies across the globe has skyrocketed in recent years. A recent study by the Pew Research Center found that, in 2021, 16% of Americans have engaged with cryptocurrency compared to only 1% in 2015.
“Digital assets are a powerful tool that have the potential to completely revolutionize economic activity around the world. To fully exploit this potential, however, consumers and investors need the appropriate protections, and there also has to be attention paid to potential risks to financial stability. If this industry continues to evolve with no guardrails in place, fraud, insufficient collateral, and a host of other issues could harm users and discredit the entire industry,” says FFWG Co-Chair and BWC Board of Directors Chair William C. Dudley.
Kick-starting the series and laying the groundwork for further in-depth analysis, this brief provides an overview of decentralized finance (DeFi) innovation, use cases, benefits, and risks. To be published over the next year, future briefs will further explore each of these topics to answer important questions about DeFi, such as where stablecoins and central bank digital currencies (CBDCs) fit within the system, what mechanisms are needed to improve market integrity and investor security, how the unique features of DeFi technology can be utilized to improve the system’s efficiency, and more. Ultimately, the goal of this series is to propose an ideal regulatory framework that provides security and stability to the industry without inhibiting innovation.
“Advancements in digital finance offer innovative alternatives to the relatively inefficient and inflexible traditional financial system and incorporating this new technology into the existing financial architecture presents an exciting opportunity for lower costs, greater transparency, and increased access to financial services. Regulators should take steps to make it attractive for new businesses to come inside the regulatory perimeter by providing clear rules of the road,” says DFPT Co-Lead and Princeton University Senior Research Scholar Carolyn Wilkins.
“State of Play in Crypto Markets: Opportunities and Dangers” will be presented at 3:15pm ET on April 22 at an in-person session at the St. Regis Washington, by William C. Dudley and Carolyn Wilkins at BWC’s 2022 Annual Meeting, and a panel discussion will follow.
About the Bretton Woods Committee
The Bretton Woods Committee is the preeminent non-profit organization dedicated to effective international economic and financial cooperation. www.brettonwoods.org
Media Contact Elena Tosana, Program Director, etosana@brettonwoods.org, +1 703-389-7428
BWC Digital Finance Project Team Brief I Press Release
Fri, Apr 22, 2022
FOR IMMEDIATE RELEASE (Washington, DC – April 22, 2022) - The Bretton Woods Committee is pleased to announce the release of our newest publication: “State of Play in Crypto Markets: Opportunities and Dangers.”
Published by our Digital Finance Project Team (DFPT), this brief is the first in an eight-part series that will explore the critical regulatory and policy issues of digital assets and the crypto market. The DFPT is a subgroup of BWC’s Future Finance Working Group (FFWG), a multisectoral group of leaders charged with evaluating emerging trends, opportunities, and ideas within the realm of global finance.
The use of digital currencies across the globe has skyrocketed in recent years. A recent study by the Pew Research Center found that, in 2021, 16% of Americans have engaged with cryptocurrency compared to only 1% in 2015.
“Digital assets are a powerful tool that have the potential to completely revolutionize economic activity around the world. To fully exploit this potential, however, consumers and investors need the appropriate protections, and there also has to be attention paid to potential risks to financial stability. If this industry continues to evolve with no guardrails in place, fraud, insufficient collateral, and a host of other issues could harm users and discredit the entire industry,” says FFWG Co-Chair and BWC Board of Directors Chair William C. Dudley.
Kick-starting the series and laying the groundwork for further in-depth analysis, this brief provides an overview of decentralized finance (DeFi) innovation, use cases, benefits, and risks. To be published over the next year, future briefs will further explore each of these topics to answer important questions about DeFi, such as where stablecoins and central bank digital currencies (CBDCs) fit within the system, what mechanisms are needed to improve market integrity and investor security, how the unique features of DeFi technology can be utilized to improve the system’s efficiency, and more. Ultimately, the goal of this series is to propose an ideal regulatory framework that provides security and stability to the industry without inhibiting innovation.
“Advancements in digital finance offer innovative alternatives to the relatively inefficient and inflexible traditional financial system and incorporating this new technology into the existing financial architecture presents an exciting opportunity for lower costs, greater transparency, and increased access to financial services. Regulators should take steps to make it attractive for new businesses to come inside the regulatory perimeter by providing clear rules of the road,” says DFPT Co-Lead and Princeton University Senior Research Scholar Carolyn Wilkins.
“State of Play in Crypto Markets: Opportunities and Dangers” will be presented at 3:15pm ET on April 22 at an in-person session at the St. Regis Washington, by William C. Dudley and Carolyn Wilkins at BWC’s 2022 Annual Meeting, and a panel discussion will follow.
About the Bretton Woods Committee
The Bretton Woods Committee is the preeminent non-profit organization dedicated to effective international economic and financial cooperation. www.brettonwoods.org
Media Contact Elena Tosana, Program Director, etosana@brettonwoods.org, +1 703-389-7428