CBDC and Stablecoins (facilitated by Jess Cheng, WSGR; Timothy Massad, Harvard; Natalya Thakur, Knox Networks; Andreas Veneris, University of Toronto)

More than 80% of the central banks are currently exploring CBDCs and the discussion has progressed to a varying degree in different jurisdictions. At the same time, stablecoins – cryptocurrencies whose price is nominally pegged to a fiat currency – have emerged as the dominant private alternative in the digital assets industry. This session will discuss the current state of progress of major CBDC projects, the varying motivations driving these projects in different jurisdictions, key requirements for designing CBDCs, and how regulators are thinking about addressing certain critical challenges (e.g., retail v. wholesale v. cross-border CBDC, monetary stability, and privacy). This session will also examine the key learnings from the collapse of the algorithmic stablecoin Terra and how stablecoins will tackle challenges related to, among other things, collateralization, liquidity, redemption, disclosure, and financial stability. Finally, the session will consider interoperability of CBDCs and stablecoins for cross-border payments, the advantages and disadvantages of CBDC versus stablecoins, as well as whether and how these payment vehicles could coexist.