UN Official Calls for Study on Crypto’s Role in Human Development
A senior UN official has urged the organization to explore how crypto, central bank digital currencies (CBDCs) and stablecoins can drive human development.
In a blog post published Monday, UN Assistant Secretary-General Kanni Wignaraja wrote that Bitcoin and Ethereum have gained traction as alternative investments, with their market value peaking at $3.9 trillion in December.
Given this massive capital pool, she suggested investigating whether even a fraction of that wealth could be redirected to support education, healthcare, skill development and job creation.
Call To Test Crypto Funds Under Strict Safeguards
Wignaraja urged a fresh approach to regulation. She stressed the need for crypto to support human development without risking financial stability. Further, she proposed that development organizations test crypto funds under strict safeguards to evaluate their impact.
How CBDCs Can Help Unbanked Populations Access Finance
Wignaraja pointed to ongoing CBDC trials in several Asian countries. She noted that digital currencies provide a secure alternative to cash. CBDCs can help integrate unbanked populations into the formal financial system. This could boost economic inclusion and expand access to financial services, she said.
Moreover, she pointed out that blockchain’s transparency could enhance accountability and curb corruption. To make this vision a reality, she suggested the UN Development Programme (UNDP) support national institutions in building oversight and risk management frameworks for CBDCs.
How can cryptocurrencies, central bank digital currencies and stablecoins benefit Asia and the Pacific?@UNDPasiapac's @kanniwignaraja helps to decrypt crypto by exploring digital currencies' potential for scaling and diversifying development finance. https://t.co/St0BqVzPbc
— UN Development (@UNDP) February 17, 2025
Can Stablecoins Preserve Liquidity in Tough Times?
Wignaraja supported integrating stablecoins into digital ID and payment systems. This could enable secure transactions for unbanked and underbanked communities. During economic crises or conflicts, digital currencies can help preserve liquidity.
They can also support vulnerable populations. She specifically urged the collection of data, best practices and case studies. This would help identify the safest and most effective ways to use stablecoins for financial resilience after crises.
Call for Eco-Friendly Crypto Solutions
While digital currencies present new opportunities, their environmental impact cannot be ignored. Wignaraja underscored the high energy consumption and e-waste generated by crypto mining, with some mining operations consuming more energy than entire countries like Thailand or Vietnam. She called for sustainable practices in crypto development and urged research into eco-friendly mining technologies to ensure digital finance grows without exacerbating environmental damage.
Volatility Limits Large-Scale Crypto Investment
Wignaraja acknowledged that the use of digital currencies in sovereign bonds and debt restructuring remains uncertain. While some nations explore cryptocurrencies as a store of value, their volatility remains a barrier to large-scale institutional investment. She emphasized the need for macroeconomic analysis and robust regulatory frameworks, encouraging collaboration between nations and corporations to evaluate how digital currencies could support financing strategies aligned with the Sustainable Development Goals (SDGs).
The conversation, she concluded, must remain open. Groups like the UN and other development partners are key players in sharing ideas and shaping how digital finance can make a real difference in people’s lives.
Source: cryptonews.com
