Federal Reserve Backs Ethereum Powered AMERIBOR as a Viable Replacement in Setting Interest Rates
Jerome Powell of the US Federal Reserve has publicly backed the AMERIBOR Index, an Ethereum powered lending solution to replace the currently used LIBOR protocol which is leveraged to decide interest rates.
Why AMERIEBOR is Prefered
The currently adopted lending rate system is LIBOR which is being phased out as a result of false data reporting by banks. Financial systems survive based on the availability of genuine data which also aid regulations. This challenge will be resolved by AMERIBOR which will utilize secure blockchain technology that will guarantee data integrity while capturing interbank lending rates.
Chairman Powell has this to say about AMERIBOR:
“AMERIBOR is a reference rate created by the American Financial Exchange based on a cohesive and well-defined market that meets the International Organization of Securities Commission’s (IOSCO) principles for financial benchmarks. While [AMERIBOR] is a fully appropriate rate for the banks that fund themselves through the American Financial Exchange (AFX) or for other similar institutions for whom AMERIBOR may reflect their cost of funding, it may not be a natural fit for many market participants.”
This shows that the AMERIBOR alternative will gain ground in the US particularly among market participants that have partnerships with the AFX.
Is this a Win for Blockchain Enthusiast?
The consideration of an Ethereum powered creation for use in the world’s largest money market gives bright hope for blockchain enthusiasts. The long term clamor of blockchain technology and its associated cryptocurrencies is to offer an alternative to the existing technologies that fight against personal financial autonomy. The gradual application of blockchain technology in key financial sectors can serve as a precedent for eventual future takeover. This thus shows that AMERIBOR is a win for the game-changing blockchain technology.
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