News
CBDCs Threaten Payment-Focused Altcoins as Central Banks Speed Toward Digital Rollouts
<p data-start="259" data-end="602">Picture this: a high-speed bullet train, government-built and free to board, pulling into a city long plagued by toll-heavy, traffic-clogged roads. Most commuters wouldn’t think twice. They’d ditch the old system and hop on. Now apply that same logic to digital money — that’s the direction central bank digital currencies (CBDCs) are heading.</p>
<p data-start="604" data-end="842">Across major economies, CBDCs are moving from theory to trial. That has serious implications for crypto investors, especially those betting on altcoins built to handle payments. The central banks’ shiny new trains may run right over them.</p>
<h2 data-start="844" data-end="897">CBDCs Aren’t a Concept Anymore — They’re Happening</h2>
<p data-start="899" data-end="974">A lot of investors still think CBDCs are a distant worry. That’s a mistake.</p>
<p data-start="976" data-end="1217">Take the Bahamas, for example. In late 2020, it launched the Sand Dollar, the first full-scale retail CBDC in the world. It works like digital cash — no interchange fees for merchants, no foreign exchange spread, and near-instant settlement.</p>
<p data-start="1219" data-end="1277">That’s not some prototype in a lab. It’s live and running.</p>
<p data-start="1279" data-end="1552">In Europe, the ECB’s digital euro project is grinding forward. While officials insist it won’t be programmable in the sense of conditional spending, they do plan to automate things like tax refunds and social payments — features private tokens simply can’t enforce legally.</p>
<p data-start="1554" data-end="1686">The UK’s latest proofs of concept include transfer flagging for suspicious activity — a regulatory dream, built right into the tech.</p>
<p data-start="1688" data-end="1878">And while the U.S. hasn’t fully committed, the April 2025 bipartisan briefing laid it bare: CBDCs are more likely to compete directly with payment-focused cryptos than with speculative DeFi.</p>
<p data-start="1880" data-end="1907">The writing is on the wall.</p>
<p data-start="1880" data-end="1907"><a href="https://www.theibulletin.com/wp-content/uploads/2025/06/central-bank-digital-currency-infrastructure.jpg"><img class="aligncenter size-full wp-image-57700" src="https://www.theibulletin.com/wp-content/uploads/2025/06/central-bank-digital-currency-infrastructure.jpg" alt="central bank digital currency infrastructure" width="1294" height="821" /></a></p>
<h2 data-start="1909" data-end="1961">XRP, Stellar, and Friends: Why They’re in Trouble</h2>
<p data-start="1963" data-end="2068">This isn’t theoretical. Tokens like XRP exist largely to make payments cheaper and faster across borders.</p>
<p data-start="2070" data-end="2161">That value proposition disappears when a state-backed option does it cheaper — or for free.</p>
<p data-start="2163" data-end="2188">A central bank can offer:</p>
<ul data-start="2190" data-end="2352">
<li data-start="2190" data-end="2207">
<p data-start="2192" data-end="2207">Zero gas fees</p>
</li>
<li data-start="2208" data-end="2227">
<p data-start="2210" data-end="2227">24/7 settlement</p>
</li>
<li data-start="2228" data-end="2317">
<p data-start="2230" data-end="2317">Interoperability across borders (currently in testing between multiple central banks)</p>
</li>
<li data-start="2318" data-end="2352">
<p data-start="2320" data-end="2352">Legal recognition out of the box</p>
</li>
</ul>
<p data-start="2416" data-end="2612">Now take XRP. Its main thesis — cross-border efficiency — looks increasingly shaky. If digital euros, pounds, or dollars can communicate with each other, then what’s XRP doing besides adding fees?</p>
<p data-start="2614" data-end="2636">That’s a real problem.</p>
<h2 data-start="2638" data-end="2679">Not Every Token Lives or Dies on Speed</h2>
<p data-start="2681" data-end="2743">Some blockchains, though, offer more than just money movement.</p>
<p data-start="2745" data-end="2941">Ethereum is a hub for DeFi. Solana’s pulling in developers with on-chain games and AI feed infrastructure. These aren&#8217;t things a central bank digital currency is built to replace. Not yet, anyway.</p>
<p data-start="2943" data-end="3093">Here’s the thing: if an altcoin’s activity vanishes after an airdrop ends or a liquidity pool dries up, that’s not real demand. That’s temporary hype.</p>
<p data-start="3095" data-end="3159">Fee compression is coming. And not all protocols can survive it.</p>
<p data-start="3161" data-end="3199">A few guiding questions for investors:</p>
<ul data-start="3201" data-end="3400">
<li data-start="3201" data-end="3275">
<p data-start="3203" data-end="3275">Can this altcoin reduce user costs without collapsing validator rewards?</p>
</li>
<li data-start="3276" data-end="3342">
<p data-start="3278" data-end="3342">Is its use case something a government would bother replicating?</p>
</li>
<li data-start="3343" data-end="3400">
<p data-start="3345" data-end="3400">Will it still exist if transaction volume falls by 80%?</p>
</li>
</ul>
<h2 data-start="3474" data-end="3538">The Clock Is Ticking — CBDCs Are Coming Faster Than You Think</h2>
<p data-start="3540" data-end="3678">The ECB is pushing for a digital euro political deal by 2026. A two- to three-year rollout would mean mainstream availability before 2030.</p>
<p data-start="3680" data-end="3728">By that point, investors will need to be asking:</p>
<ul data-start="3730" data-end="3844">
<li data-start="3730" data-end="3762">
<p data-start="3732" data-end="3762">Is my altcoin actually useful?</p>
</li>
<li data-start="3763" data-end="3844">
<p data-start="3765" data-end="3844">Or is it just a slower version of something the government now offers for free?</p>
</li>
</ul>
<p data-start="3846" data-end="3893">Here’s a timeline snapshot of key developments:</p>
<div class="_tableContainer_16hzy_1">
<div class="_tableWrapper_16hzy_14 group flex w-fit flex-col-reverse" tabindex="-1">
<table class="w-fit min-w-(--thread-content-width)" data-start="3895" data-end="4456">
<thead data-start="3895" data-end="3988">
<tr data-start="3895" data-end="3988">
<th data-start="3895" data-end="3910" data-col-size="sm">Region</th>
<th data-start="3910" data-end="3939" data-col-size="sm">CBDC Status</th>
<th data-start="3939" data-end="3988" data-col-size="md">Notes</th>
</tr>
</thead>
<tbody data-start="4083" data-end="4456">
<tr data-start="4083" data-end="4175">
<td data-start="4083" data-end="4098" data-col-size="sm">Bahamas</td>
<td data-start="4098" data-end="4127" data-col-size="sm">Launched (2020)</td>
<td data-start="4127" data-end="4175" data-col-size="md">First full-scale retail CBDC</td>
</tr>
<tr data-start="4176" data-end="4268">
<td data-start="4176" data-end="4191" data-col-size="sm">Eurozone</td>
<td data-start="4191" data-end="4220" data-col-size="sm">Political talks by 2026</td>
<td data-start="4220" data-end="4268" data-col-size="md">Social payments and tax automation in plan</td>
</tr>
<tr data-start="4269" data-end="4362">
<td data-start="4269" data-end="4284" data-col-size="sm">UK</td>
<td data-start="4284" data-end="4313" data-col-size="sm">Proof of concept phase</td>
<td data-start="4313" data-end="4362" data-col-size="md">Programmable compliance features being tested</td>
</tr>
<tr data-start="4363" data-end="4456">
<td data-start="4363" data-end="4378" data-col-size="sm">US</td>
<td data-start="4378" data-end="4407" data-col-size="sm">Under study</td>
<td data-start="4407" data-end="4456" data-col-size="md">Retail impact explored, but no rollout yet</td>
</tr>
</tbody>
</table>
<div class="sticky end-(--thread-content-margin) h-0 self-end select-none">
<div class="absolute end-0 flex items-end"></div>
</div>
</div>
</div>
<p data-start="4458" data-end="4523">If this table feels like a countdown clock, that’s because it is.</p>
<h2 data-start="4525" data-end="4557">Where Could Crypto Still Win?</h2>
<p data-start="4559" data-end="4615">There&#8217;s light at the end of the tunnel. But it’s narrow.</p>
<p data-start="4617" data-end="4771">Tokens tied to high-complexity utility — like decentralized compute, AI model training marketplaces, or real-world asset tokenization — have less to fear.</p>
<p data-start="4773" data-end="4868">CBDCs won’t be hosting on-chain games or running decentralized options contracts any time soon.</p>
<p data-start="4870" data-end="4917">And then there’s culture. Yes, even meme coins.</p>
<p data-start="4919" data-end="5065">Meme tokens exploded in 2024, defying logic, regulation, and economic gravity. They captured sentiment in ways CBDCs can’t — and maybe never will.</p>
<p data-start="5067" data-end="5166">That said, depending on vibes to justify multi-billion-dollar valuations is a shaky hill to die on.</p>
<h2>Final Thought: Altcoin Investors Need to Adjust</h2>
<p data-start="5323" data-end="5388">Payment-based altcoins will need to evolve — or shrink. Big time.</p>
<p data-start="5390" data-end="5601">Tokens like XRP still have niches in institutional infrastructure, particularly if they can offer compliance-ready, high-speed rails in countries that delay their CBDCs. But that’s a narrower market than before.</p>
<p data-start="5603" data-end="5701">Pure-play payment tokens without deep utility or strong narratives? Those are walking a tightrope.</p>
<p data-start="5703" data-end="5844">Investors should keep allocations to those lean. Focus instead on tokens doing something the digital euro or digital dollar won&#8217;t — or can’t.</p>
<p data-start="5846" data-end="5918">Because once the bullet train arrives, the toll road gets awfully quiet.</p>
<hr data-start="5920" data-end="5923" />
<p data-start="5925" data-end="5956">Category: News<br data-start="5939" data-end="5942" />Cryptocurrency</p>
<p data-start="5958" data-end="6130">Meta Description: CBDCs are moving fast. Here&#8217;s how state-backed digital money could crush payment-focused altcoins like XRP — and where investors might still find shelter.</p>
<p data-start="6132" data-end="6183">URL Slug: cbdcs-vs-altcoins-xrp-payment-crypto-risk</p>
<p data-start="6185" data-end="6236">Image:</p>
<p data-start="6238" data-end="6405" data-is-last-node="" data-is-only-node="">

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