Barry Silbert Explains Why Central Bank Digital Currencies Boost Bitcoin
On Feb. 12, Barry Silbert, the founder and CEO of Digital Currency Group (DCG) and Grayscale Investments, spoke about his positive perspective on Bitcoin in a Grayscale investor call. He covered different issues related to digital assets, such as the role of Bitcoin in the transfer of wealth across generations, decentralized finance, stablecoins and central bank digital currencies (CBDCs).
CBDCs are digital currencies that a federal regulator controls and issues. Unlike cryptocurrencies like Bitcoin, CBDCs represent fiat money in the digital form. No CBDC has been launched by any global jurisdiction yet, but such projects have been developed and explored by many governments. At least 10% of central banks are anticipated to issue a CBDC for the general public soon, while China is reportedly about to test its CBDC.
Barry Silbert millionaire, who claims to have bought his first Bitcoin in 2012, three years after the creation of the first block on the Bitcoin blockchain, argued that central banks that develop their own digital currencies might be giving more power to Bitcoin by creating the infrastructure for institutional interest. He thinks that the same infrastructure that is used by the widespread adoption of CBDCs could benefit Bitcoin and other non-central bank cryptocurrencies: “So at one point of the future we might have 80 different CBDCs. And if that happens, it would trigger a tremendous amount of investment in operators of financial systems where essentially every financial institution would then have to be able to safely store and transact CBDCs and, guess what, if they actually build that infrastructure, that same infrastructure could be used for non-central bank digital currencies like Bitcoin.” He also said that he was confident that central banks will not cap the supply of the digital currency and will require users to engage and use the existing financial systems. “Central banks love to print money,” Silbert said, highlighting Bitcoin’s limited supply feature.
As he leads two major companies that are involved in various aspects of digital assets, Silbert is one of the most influential figures in the crypto industry. Grayscale Investments is the world’s largest digital asset manager, with over $40 billion in assets under management as of Feb. 12. Digital Currency Group is a venture capital firm that invests in various crypto-related projects, such as Gensis Trading, Foundry and CoinDesk.
Silbert has been vocal about his bullish views on Bitcoin and other cryptocurrencies for a long time. He has also been critical of some projects, such as Ripple (XRP), which he thinks are centralized and not real cryptocurrencies. He has also predicted that most altcoins will experience bankruptcy in the long run, while Bitcoin will continue to dominate the market.
To sum up, Barry Silbert is a prominent figure in the cryptocurrency industry who thinks that central bank digital currencies are beneficial for Bitcoin. He maintains that CBDCs will create the infrastructure for institutional interest in non-central bank cryptocurrencies like Bitcoin. He also highlights that Bitcoin has a limited supply feature that makes it superior to fiat money. He leads two major companies that are involved in various aspects of digital assets: Digital Currency Group and Grayscale Investments.