11/22/2023 - Technology and Innovation

The future of the bank.

By Horacio Gustavo Ammaturo

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Imagen de portada

Tokenized money.

In line with what Argentine President Javier Milei advocates for free competition between currencies so that private individuals choose which they prefer for their transactions, investments or savings, the traditional financial system is directed to integrate their operating systems so that they can offer customers new services that serve as a connecting vessel between different monetary species.As we have seen sustaining in this column, “the way we call money is not relevant, from the user’s point of view the important is the purchasing power that keeps in time”, however, seeing it from the financial system there are other attributes to take into account how the environment is by which payments are processed, hurt me when different technologies could exist for the emission and support of the different currencies.In this sense, commercial banks around the world explore incorporating new technologies based on Blockchain and its interaction with non-bank fintechs.tokenizadoTo access and interact with digital assets it is necessary to pay with forms of digital money.Faced with the volatility of cryptocurrencies, the private issue of stable currencies, such as USD T or the USD C served as the gateway (incoming and exit ramp) between the different monetary species. Stable currencies provided stability and value reserve between transactions and their adoption grew rapidly.It was estimated that stable currencies were used to settle more than 7 billion dollars in 2022.In response, banks have shown interest in joining the group, providing trust and credibility to the space as regulators begin to define the rules more clearly.The banks of Australia, like ANZ, have issued Australian obligations fully backed up in stable currencies in dollars, and there is a growing interest in tokenized deposits issued as a liabilities of commercial banks, much like the money from commercial banks today.Unlike fully supported stable currencies, which ultimately block or exhaust the liquidity of the banking system, Tokenized deposits can enable credit creation and support economic growth.Probably, this is one of the first slabions that serve as a common denominator between the various processing systems that coexist, which will become the bridge between electronic and digital dinerary formats, opening the doors to a new world of financial instruments.It is important to highlight that money tokenized NOT a cryptocurrency, on the contrary, is a way to register traditional money transactions whose particularity is that it has a processing network designed in Blockchain that interacts through banking institutions with the rest of the systems, as well as today do other processing methods.

Let us see some of the opportunities offered by money tokenized by a banking entity:

  1. Because it is an expression of a balance deposited in the bank has its aval.
  2. Contan with customers to which to offer the product, so its adoption can be quick and effective.
  3. Networks trade Joined to other payment processing systems, with which the deployment of an acquisition network would be fast and low-cost.
  4. Banking platforms are integrated With most financial markets, commercial, financial and investment transactions can be associated.
  5. It is simply a form of accounting record of funds or banking instruments, in principle, the regulatory framework In effect it would be enough.
  6. The Tokenized Money includes all business models Currently and serves to include other new and rapid growth.
  7. It would be a very useful tool for Financial inclusion because people who are outside the banking system could trade with tokenized money, however, exclusively those with bank accounts may enter and exit the system.
  8. Allows you to New investment proposals, as are transferable and fractionable time frames, so customers can keep their income deposits permanently.
Undoubtedly, tokenized money is an alternative to overcome traditional money and cryptocurrencies, because it has the support and norm of experience, and with the technological versatility and the transactional economy of modernity.

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horacio gustavo ammaturo

Horacio Gustavo Ammaturo

I am Gustavo Ammaturo. I have a degree in Economics. CEO and Director of infrastructure, energy and telecommunications companies. Founder and mentor of Fintech, DeFi and software development companies. Blockchain Product Designer.

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