central bank digital currency

{{See also|History of CBDCs by country}}

Although the term "CBDC" did not become widely used until after 2019, central banks have researched and launched digital currency projects for decades. For example, Finland's central bank issued the Avant stored value e-money card in the 1990s.{{cite journal |last1=Grym |first1=Aleksi |last2=Heikkinen |first2=Päivi |last3=Kauko |first3=Karlo |last4=Takala |first4=Kari |title=Central bank digital currency |journal=BoF Economics Review |date=2017 |volume=5 |url=https://helda.helsinki.fi/bof/handle/123456789/14952 }} In 2014, the Chinese central bank began researching the idea of issuing a CBDC.{{Cite web |last=Working Group on E-CNY Research and Development of the People's People's People's People's Bank of China |date=July 2021 |title=Progress of Research & Development of E-CNY in China |url=http://www.pbc.gov.cn/en/3688110/3688172/4157443/4293696/2021071614584691871.pdf |archive-url= https://web.archive.org/web/20210716080501/http://www.pbc.gov.cn/en/3688110/3688172/4157443/4293696/2021071614584691871.pdf|website=People's Bank of China|archive-date=16 July 2021 }} Elsewhere, the Ecuadorian central bank operated a mobile payment system from 2014 to 2018.{{Cite journal |last1=Arauz |first1=Andrés |last2=Garratt |first2=Rodney |last3=Ramos F. |first3=Diego F. |date=2021-06-01 |title=Dinero Electrónico: The rise and fall of Ecuador's central bank digital currency |journal=Latin American Journal of Central Banking |volume=2 |issue=2 |pages=100030 |doi=10.1016/j.latcb.2021.100030 |issn=2666-1438|doi-access=free }} In 2021, Australia's central bank conducted a proof of concept for a wholesale CBDC using Ethereum to tokenize syndicated loans, aiming to automate and secure high-value transactions in the banking sector.{{Cite web |title=Exploring a Wholesale CBDC for Syndicated Lending |url=https://www.rba.gov.au/payments-and-infrastructure/central-bank-digital-currency/pdf/project-atom-report_2021-12.pdf |access-date=2024-05-11 |website=Reserve Bank of Australia}}

A central bank digital currency would likely be implemented using a database run by the central bank, government, or approved private-sector entities.{{Cite web|url=https://bank.gov.ua/admin_uploads/article/Analytical%20Report%20on%20E-hryvnia.pdf|title=Analytical Report on the E-Hryvnia Pilot Project|website=National Bank of Ukraine}} The database would keep a record (with appropriate privacy and cryptographic protections) of the amount of money held by every entity, such as people and corporations.

In contrast to cryptocurrency, a central bank digital currency would be centrally controlled (even if it was on a distributed database), and so a blockchain or other distributed ledger would likely not be required or useful - even though they were the original inspiration for the concept.

By March 2024, the central banks of 134 countries accounting for 98% of the world's GDP were said to be in various stages of evaluating the launch of a national digital currency.{{Cite web |title=Central Bank Digital Currency Tracker |url=https://www.atlanticcouncil.org/cbdctracker/ |access-date=2024-03-27 |website=Atlantic Council |language=en-US}} These included the ECB, the UK, and the US.{{Cite tweet|number=1382991097849376768|user=lagarde|title=Our work on a possible #digitaleuro continues.|author=Christine Lagarde|author-link=Christine Lagarde|date=16 April 2021}}{{Cite news |date=2020-12-05 |title=Will central-bank digital currencies break the banking system? |newspaper=The Economist |url=https://www.economist.com/finance-and-economics/2020/12/05/will-central-bank-digital-currencies-break-the-banking-system |access-date=2020-12-07 |issn=0013-0613}} China's digital RMB was the first digital currency to be issued by a major economy.{{Cite news |last=Areddy |first=James T. |date=2021-04-05 |title=Bahamas is the first country in the world to issue central bank digital currency (Bahamanian Dollar) |language=en-US |work=The Wall Street Journal |url=https://www.wsj.com/articles/china-creates-its-own-digital-currency-a-first-for-major-economy-11617634118 |access-date=2021-04-06 |issn=0099-9660}}{{Cite news |last1=Popper |first1=Nathaniel |last2=Li |first2=Cao |date=2021-03-01 |title=China Charges Ahead With a National Digital Currency |language=en-US |work=The New York Times |url=https://www.nytimes.com/2021/03/01/technology/china-national-digital-currency.html |access-date=2021-04-06 |issn=0362-4331}} Six central banks have launched a CBDC: the Central Bank of The Bahamas (Sand Dollar), the Eastern Caribbean Central Bank (DCash), the Central Bank of Nigeria (e-Naira), the Bank of Jamaica (JamDex), People's Bank of China (Digital renminbi), the Reserve Bank of India (Digital Rupee), and Bank of Russia (Digital Ruble).{{Cite web |title=Central Bank Digital Currency Tracker |url=https://www.atlanticcouncil.org/cbdctracker/ |access-date=2023-01-07 |website=Atlantic Council |language=en-US}} The Central Bank of Brazil has been rolling out tests of a digital Brazilian currency (Drex) since March 2023.{{Cite web |title=Banco Central do Brasil |url=https://www.bcb.gov.br/en/financialstability/drex_en |access-date=2023-11-09 |website=www.bcb.gov.br}} The ECB/Eurozone decided in October 2023 to move forward to the preparation phase for the potential issuance of a digital euro after a two-year study phase.{{Cite journal |last=Bank |first=European Central |date=2023-10-18 |title=Eurosystem proceeds to next phase of digital euro project |url=https://www.ecb.europa.eu/press/pr/date/2023/html/ecb.pr231018~111a014ae7.en.html |language=en}}

In the USA, the Republican Party is generally against CBDCs.{{Cite journal |last=Party |first=Republican |date=2025-02-10 |title=Senators reintroduce bill to bar CBDC |url=https://www.paymentsdive.com/news/republican-senators-reintroduce-legislation-bar-cbdc/739754/ |language=en }} The Swedish Rikstag has been unsympathetic to the Riksbank's enthusiasm for a CBDC. Ukraine focussed on the risk of disintermediating commercial banks bank in 2020. {{Cite journal |date=2020-02-25 |title=E-Hryvnia Threatens Landscape of Banking System |url=https://cointelegraph.com/news/ukraines-central-bank-e-hryvnia-threatens-landscape-of-banking-system |language=en }} The Polish National Bank is opposed to a CBDC. {{Cite journal |date=2025-05-21 |title=Central Bank Digital Currency|url=https://nbp.pl/en/payment-system/statistical-data/analyzes-and-studies/central-bank-digital-currency/ |language=en }}

Some states have also issued, or have considered issuing, cryptocurrencies: these include Venezuela (Petro) and the Marshall Islands (Sovereign). These cryptocurrencies are often considered with the intent of increasing a state's independence from global financial systems, such as by reducing dependence on a foreign currency or by evading international sanctions.[https://www.wsj.com/articles/u-s-warns-banks-crypto-firms-against-potential-efforts-to-evade-russian-sanctions-11646696802 U.S. Warns Banks, Crypto Firms Against Potential Efforts to Evade Russian Sanctions] (9 March 2022) www.wsj.com. Retrieved 9 March 2022.{{cite web |last1=Keane |first1=Jonathan |date=23 Apr 2018 |title=Inside the Marshall Islands' plans to launch its own legal tender cryptocurrency |url=https://thenextweb.com/hardfork/2018/04/23/marshall-islands-cryptocurrency/ |access-date=29 September 2018 |website=The Next Web}}

Contrasting attitudes towards digital currencies were demonstrated by developments in the UK and Switzerland in February 2023. The UK Treasury and the Bank of England said a state-backed digital pound was likely to be launched some time after 2025. Two weeks later, a Swiss lobby group triggered a national vote on maintaining a "sufficient quantity" of cash in circulation over fears that electronic payments make it easier for the state to monitor its citizens' actions.{{Cite news |date=2023-02-06 |title=Swiss to vote on preventing cashless society, pressure group says |language=en |work=Reuters |url=https://www.reuters.com/markets/europe/swiss-vote-preventing-cashless-society-pressure-group-says-2023-02-06/ |access-date=2023-02-21}} In a comment on the British government's plans, the BBC's Faisal Islam said the issue was about access to the data attached to every spending transaction, and whether people might choose to trust a global company more than the state: "The eye here is on maintaining UK monetary sovereignty against upheaval from the likes of Big Tech."{{Cite news |date=2023-02-06 |title=Digital pound likely this decade, Treasury says |language=en-GB |work=BBC News |url=https://www.bbc.com/news/technology-64536593 |access-date=2023-02-21}}

A major issue with central bank digital currencies is deciding whether the currency should be easily traceable. If it's traceable, the government has more control than it currently does. Additionally, there's a technical aspect to consider: whether CBDCs should be based on tokens or accounts and how much anonymity users should have.{{Cite journal |last1=Solberg Söilen |first1=Klaus |last2=Benhayoun |first2=Lamiae |date=2022-02-01 |title=Household acceptance of central bank digital currency: the role of institutional trust |url=https://www.emerald.com/insight/content/doi/10.1108/IJBM-04-2021-0156/full/html |journal=International Journal of Bank Marketing |language=en |volume=40 |issue=1 |pages=172–196 |doi=10.1108/IJBM-04-2021-0156 |issn=0265-2323|url-access=subscription }}

A CBDC is a digital counterpart to fiat money, issued by central banks, unless it is dividend-yielding, then it is an ownership stake in the central bank and a new form of legal tender.{{Cite web |date=2022-05-06 |title=Central bank digital currencies are in the spotlight - KPMG Global |url=https://kpmg.com/xx/en/home/insights/2022/04/central-bank-digital-currencies-are-in-the-spotlight.html |access-date=2024-03-12 |website=KPMG |language=en-US}} Like paper banknotes, it is a means of payment, a unit of account, and a store of value.{{cite web |url=http://www.riksbank.se/Documents/Tal/Skingsley/2016/tal_skingsley_161116_eng.pdf |title=Should the Riksbank issue e-krona? |publisher=Sveriges Riksbank}} And like paper currency, each unit is uniquely identifiable to prevent counterfeiting.{{cite news|url=http://mof.gov.in/reports/watal_report271216.pdf|title=Medium Term Recommendations to Strengthen Digital Payments Ecosystem|publisher=Committee on Digital Payments: Ministry of Finance, Government of India|access-date=July 17, 2017|archive-url=https://web.archive.org/web/20170709064723/http://mof.gov.in/reports/watal_report271216.pdf|archive-date=July 9, 2017|url-status=dead}} CBDC will have implications for commercial banks, probably in the field of lowering banks' commissions, no big customer data-selling ability, accumulating the deposits and deposit policies and credit policies due to higher funding costs for banks.{{Citation |last1=Jagrič |first1=Timotej |title=The Banking Industry in the Ecosystem of Digital Currencies and Digital Central Bank Currencies |date=2022-09-15 |url=https://www.emerald.com/insight/content/doi/10.1108/S1569-37592022000109A006/full/html |work=Contemporary Studies in Economic and Financial Analysis |pages=89–115 |editor-last=Grima |editor-first=Simon |publisher=Emerald Publishing Limited |doi=10.1108/s1569-37592022000109a006 |isbn=978-1-80382-980-7 |access-date=2022-12-02 |last2=Fister |first2=Dušan |last3=Amon |first3=Aleksandra |last4=Jagrič |first4=Vita |last5=Beloglavec |first5=Sabina Taškar |editor2-last=Özen |editor2-first=Ercan |editor3-last=Boz |editor3-first=Hakan|url-access=subscription }}

Digital fiat currency is part of the base money supply,{{cite journal |last1=Meaning |first1=Jack |last2=Dyson |first2=Ben |last3=Barker |first3=James |last4=Clayton |first4=Emily |title=Broadening Narrow Money: Monetary Policy with a Central Bank Digital Currency |date=25 May 2018 |journal=Bank of England |issue=724 |doi=10.2139/ssrn.3180720 |ssrn=3180720 |s2cid=158676984}} together with other forms of the currency. As such, DFC is a liability of the central bank just as physical currency is.{{cite web|url=https://www.bis.org/cpmi/publ/d174.pdf |title=Central Bank Digital Currencies| publisher=Bank for International Settlements |access-date=April 13, 2018}} It is a digital bearer instrument that can be stored, transferred and transmitted by all kinds of digital payment systems and services. The validity of the digital fiat currency is independent of the digital payment systems storing and transferring the digital fiat currency.{{cite news |last1=Tracy |first1=Ryan |title=Central Bankers Explore Response to Bitcoin: Their Own Digital Cash |url=https://www.wsj.com/articles/central-bankers-explore-response-to-bitcoin-their-own-digital-cash-1449657001 |access-date=19 June 2021 |work=The Wall Street Journal |date=10 December 2015}}

Proposals for CBDC implementation often involve the provision of universal bank accounts at the central banks for all citizens.{{Cite web|url=http://positivemoney.org/publications/digital-cash/|title=Digital Cash: Why central banks should issue digital currency|website=positivemoney.org|access-date=2017-11-09}}{{Cite web|url=https://www.sovereignmoney.eu/sovereign-digital-currency/|title=Sovereign Digital Currency|website=sovereign money|language=en-US|access-date=2017-11-10|archive-date=11 November 2017|archive-url=https://web.archive.org/web/20171111042318/https://www.sovereignmoney.eu/sovereign-digital-currency/|url-status=dead}}

Governments and central banks are studying CBDCs and their implications for financial inclusion, economic growth, technology innovation, and the efficiency of bank transactions.{{Cite web|url=http://www3.weforum.org/docs/WEF_CBDC_Policymaker_Toolkit.pdf|title=Central Bank Digital Currency Policy-Maker Toolkit|last=World Economic Forum|access-date=2021-01-03}}{{Cite web|url=http://voxeu.org/article/benefits-central-bank-digital-currency|title=Central bank digital currency and the future of monetary policy|last1=Bordo|first1=Michael|last2=Levin|first2=Andrew|date=2017-09-23|website=VoxEU.org|access-date=2017-11-10}} Potential advantages include:

• Technological efficiency: instead of relying on intermediaries such as banks and clearing houses, money transfers and payments could be made in real time, directly from the payer to the payee. Being real time has some advantages:
• Reduces risk: payment for goods and services often needs to be done in a timely manner and when payment verification is slow, merchants usually accept the risk of some payments not succeeding in exchange for faster service to customers. When these risks are eliminated with instant payment verifications, merchants no longer need to use intermediaries to handle the risk or to absorb the risk cost themselves.
• Reduces complexity: merchants will not need to separately keep track of transactions that are slow (where the customer claims to have paid but the money has not arrived yet), therefore eliminate the waiting queue, which could simplify the transaction process from payment to rendition of goods/services.
• Reduces (or eliminates) transaction fees: current payment systems like Visa, Mastercard, American Express etc. have a fee attached to each transaction and lowering or eliminating these fees could lead to widespread price drops and increased adoption of digital payments.
• Financial inclusion: safe money accounts at the central banks could constitute a strong instrument of financial inclusion, allowing any legal resident or citizen to be provided with a free or low-cost basic bank account.
• Preventing illicit activity: A CBDC makes it feasible for a central bank to keep track of the exact location of every unit of the currency (assuming the more probable centralized, database form){{cite journal |last1=Bindseil |first1=Ulrich |title=Tiered CBDC and the financial system |journal=ECB Working Paper |date=January 2020 |issue=ECB Working Paper Series No 2351 / January 2020 |pages=6–7 |access-date=2 February 2020|url=https://www.ecb.europa.eu/pub/pdf/scpwps/ecb.wp2351~c8c18bbd60.en.pdf}}
• Tax collection: It makes tax avoidance and tax evasion much more difficult, since it would become impossible to use methods such as offshore banking and unreported employment to hide financial activity from the central bank or government. In contrast, cryptocurrencies risk undermining effort to crack down on corporate tax avoidance.{{Cite web |last=Iwayemi |first=Sion Bell, Timi |date=2021-07-27 |title=How to Catch Bitcoin Tax Cheats |url=http://washingtonmonthly.com/2021/07/27/how-to-catch-bitcoin-tax-cheats/ |access-date=2023-02-21 |website=Washington Monthly |language=en-US}}
• Combating crime: It makes it much easier to spot criminal activity (by observing financial activity), and thus put an end to it. Furthermore, in cases where criminal activity has already occurred, tracking makes it much harder to successfully launder money, and it would often be straightforward to instantly reverse a transaction and return money to the victim of the crime.
• Proof of transaction: a digital record exists to prove that money changed hands between two parties which avoids problems inherent to cash such as short-changing, cash theft and conflicting testimonies.
• Protection of money as a public utility: digital currencies issued by central banks would provide a modern alternative to physical cash – whose abolition is currently being envisaged.{{cite news |last1=Das |first1=Satyajit |title=Think Twice About Going Cashless |url=https://www.bloomberg.com/opinion/articles/2017-05-21/world-should-think-twice-before-abolishing-cash |access-date=19 June 2021 |work=Bloomberg |archive-url=https://web.archive.org/web/20201111235554/https://www.bloomberg.com/opinion/articles/2017-05-21/world-should-think-twice-before-abolishing-cash |archive-date=11 November 2020 |url-status=live}}
• Safety of payments systems: A secure and standard interoperable digital payment instrument issued and governed by a Central Bank and used as the national digital payment instruments boosts confidence in privately controlled money systems and increases trust in the entire national payment system{{cite speech |last=Nicolaisen |first=Jon |title=What should the future form of our money be? |date=25 April 2017 |location=Norwegian Academy of Science and Letters |publisher=Norges Bank |url=https://www.norges-bank.no/en/news-events/news-publications/Speeches/2017/2017-04-25-dnva/ |access-date=19 June 2021 |language=en}}{{Cite web|url=https://www.riksbank.se/en-gb/press-and-published/speeches-and-presentations/2017/ingves-do-we-need-an-e-krona/|title=Ingves: Do we need an e-krona?|last=Riksbanken|website=www.riksbank.se|language=en|access-date=2017-12-13}} while also boosting competition in payment systems.
• Preservation of seigniorage income: public digital currency issuance would avoid a predictable reduction of seigniorage income for governments in the event of a disappearance of physical cash.{{Cite web|url=https://www.bankofcanada.ca/2017/11/staff-discussion-paper-2017-16/|title=Central Bank Digital Currency: Motivations and Implications|website=www.bankofcanada.ca|date=30 November 2017|language=en-US|access-date=2017-12-03}}
• Banking competition: the provision of free bank accounts at the central bank offering complete safety of money deposits could strengthen competition between banks to attract bank deposits, for example by offering once again remunerated sight deposits.
• Monetary policy transmission: the issuance of central bank base money through transfers to the public could constitute a new channel for monetary policy transmission{{Cite web|url=http://www.bnm.gov.my/index.php?ch=en_publication&pg=en_staffinsight&ac=45&bb=file|title=Central Bank Digital Currency: A Monetary Policy Perspective|website=Central bank of Malaysia|access-date=November 9, 2017|archive-date=July 30, 2020|archive-url=https://web.archive.org/web/20200730134346/https://www.bnm.gov.my/index.php?ch=en_publication&pg=en_staffinsight&ac=45&bb=file|url-status=dead}}{{cite report |last=Heller |first=Daniel |date=15 May 2017 |title=The implications of digital currencies for monetary policy |url=https://www.europarl.europa.eu/thinktank/en/document.html?reference=IPOL_IDA(2017)602048 |publisher=European Parliament Think Tank |access-date=19 June 2021}}

{{Cite news|url=http://www.positivemoney.eu/2018/03/helicopter-money-real-viable-possibility-says-czech-central-banker/|title=Helicopter money is "a real possibility," says Czech central banker|date=2018-03-15|work=Positive Money Europe|access-date=2018-09-28|language=en-GB}} (i.e. helicopter money{{Cite journal|title=Central Bank Equity as an Instrument of Monetary Policy|journal=Comparative Economic Studies|doi=10.1057/s41294-019-00092-1|year=2019|last1=Hampl|first1=Mojmir|last2=Havranek|first2=Tomas|volume=62|pages=49–68|s2cid=59485719}}), which would allow more direct control of the money supply than indirect tools such as quantitative easing and interest rates, and possibly lead the way towards a full reserve banking system.{{Cite web|url=https://www.nbb.be/en/articles/digital-currencies-threats-and-opportunities-monetary-policy|title=Digital currencies: threats and opportunities for monetary policy {{!}} nbb.be|last=Stevens|first=A|date=June 2017|website=www.nbb.be|publisher=National Bank of Belgium|language=en|access-date=2017-11-10}} In digital Yuan trial in Shenzhen, the CBDC was programmed with an expiration date, which encouraged spending and discouraged money from sitting in a saving account. In the end, 90% of vouchers were spent in shops.{{cite news |last1=Chen |first1=Yawen |title=China's e-yuan solves one stimulus problem |url=https://www.businesstimes.com.sg/banking-finance/chinas-e-yuan-solves-one-stimulus-problem |access-date=20 June 2021 |work=The Business Times |agency=Reuters |date=2020-11-24 |archive-url=https://web.archive.org/web/20210119035123/https://www.businesstimes.com.sg/banking-finance/chinas-e-yuan-solves-one-stimulus-problem |archive-date=2021-01-19 |url-status=live}} Demurrage currency could be implemented, perhaps by shaving off fractions of the value on a scheduled basis, as a supplement to traditional inflation targets.{{Cite web |title=CBDC Part II: A New Form of Monetary Policy? {{!}} Portfolio for the Future {{!}} CAIA |url=https://caia.org/blog/2021/12/22/cbdc-part-ii-new-form-monetary-policy |access-date=2023-01-19 |website=caia.org |language=en}}

• Financial safety: CBDC would provide an alternative to fractional reserve banking for daily uses, for those who want to avoid all risk of bank runs, despite the relative safety provided by deposit insurance.{{Cite web|url=https://voxeu.org/article/digital-euro-save-emu|title=A digital euro to save EMU|last=Mayer|first=Thomas|date=2019-11-06|website=VoxEU.org|access-date=2019-11-10}}

Despite having potential advantages, CBDCs remain a controversial topic, and there are risks associated with their implementation.

• Banking system disintermediation: With the ability to provide digital currency directly to its citizens, one concern is that depositors would shift out of the banking system. Customers may deem the safety, liquidity, solvency, and publicity of CBDCs to be more attractive,{{cite magazine |last=Tilton |first=Andrew| date=29 October 2020| title= The what and why of digital currencies|magazine= Goldman Sachs Research Newsletter| publisher=Goldman Sachs| issue=94| access-date= 18 June 2021|url=https://www.goldmansachs.com/insights/pages/gs-research/whats-in-store-for-the-dollar/report.pdf| archive-url=https://web.archive.org/web/20210329114639/https://www.goldmansachs.com/insights/pages/gs-research/whats-in-store-for-the-dollar/report.pdf| archive-date= 29 March 2021| url-status=live}} weakening the balance sheet position of commercial banks.{{cite journal |last1=Pfister |first1=Christian |title=Monetary Policy and Digital Currencies: Much Ado about Nothing? |journal=Banque de France Working Paper |date=September 2017 |url=https://publications.banque-france.fr/sites/default/files/medias/documents/dt-642.pdf |access-date=19 June 2021 |publisher=Banque de France}} In the extreme, this could precipitate potential bank runs{{Cite web|url=https://www.suerf.org/wp-content/uploads/2016/05/l_ec5decca5ed3d6b8079e2e7e7bacc9f2_9467_suerf.pdf|title=Fintech and Central Banks|last=Smets|first=Jan|date=December 9, 2016|publisher=National Bank of Belgium}} and thus make banks' funding positions weaker. However, the Bank of England found that if the introduction of CBDC follows a set of core principles, the risk of a system-wide run from bank deposits to CBDC is addressed.{{Cite web|url=https://www.bankofengland.co.uk/-/media/boe/files/working-paper/2018/central-bank-digital-currencies-design-principles-and-balance-sheet-implications.pdf?la=en&hash=11469281B32821BCFD85B4A5483AB3577E38B2DD|title=Central bank digital currencies — design principles and balance sheet implications|last1=Kumhof|first1=Michael|last2=Noone|first2=Clare|date=May 2018|publisher=Bank of England|access-date=10 January 2019}} A central bank could also limit the demand of CBDCs by setting a ceiling on the amount of holdings.
• Centralization: Since most central bank digital currencies are centralized, rather than decentralized like most cryptocurrencies, the controllers of the issuance of CBDCs can add or remove money from anyone's account with a flip of a switch.
• Digital dollarization: A well-run foreign digital currency could become a replacement for a local currency for the same reasons as those described in dollarization.{{cite speech |last1=Carstens |first1=Agustín |title=Digital currencies and the future of the monetary system |date=27 January 2021 |url=https://www.bis.org/speeches/sp210127.pdf |access-date=19 June 2021 |language=en |event=Hoover Institution policy seminar |location=Basel |publisher=Bank of International Settlements |archive-url=https://web.archive.org/web/20210430055435/https://www.bis.org/speeches/sp210127.pdf |archive-date= 30 April 2021 |url-status=live}} The announcement of Facebook's Libra contributed to the increased attention to CBDCs by central bankers,{{cite speech |last1=Panetta |first1=Fabio |title=From the payments revolution to the reinvention of money |event= Deutsche Bundesbank conference on the "Future of Payments in Europe"| location=Frankfurt |url=https://www.ecb.europa.eu/press/key/date/2020/html/ecb.sp201127~a781c4e0fc.en.html |publisher=European Central Bank |access-date=19 June 2021 |archive-url=https://web.archive.org/web/20210306000034/https://www.ecb.europa.eu/press/key/date/2020/html/ecb.sp201127~a781c4e0fc.en.html |archive-date=6 March 2021 |url-status=live |language=en |date=27 November 2020}} as well as China's progress with DCEP to that of several Asian economies.
• Privacy:
• "Governments have direct visibility of financial transactions",{{Cite web|url=https://time.com/6084146/china-digital-rmb-currency/|title = How China's Digital Currency Could Challenge the Almighty Dollar; Charlie Campbell|website = Time.com|date = 11 August 2021}}

an "eagle-eyed view on the spending of everyone".

{{Cite web|url=https://financialpost.com/fp-finance/cryptocurrency/china-is-blazing-a-trail-with-the-digital-yuan-and-governments-around-the-world-are-watching-closely|title=China is blazing a trail with the digital yuan and governments around the world are watching closely; Ethan Lou|website = FinancialPost.com|date = 27 January 2022}}

• Digital currency would give a country "broad new powers when it comes to surveillance and controlling its population."
• Data from tracing money routes could lead to losing financial privacy if the CBDC implementation does not have adequate privacy protections. This could lead to encouraging of self-censorship, deterioration of freedom of expression and association, and ultimately to stalling social developments.{{Citation|title=Ori Freiman, The Ethics of Central Bank Digital Currency (Ethics of AI in Context)| date=19 January 2022 |url=https://www.youtube.com/watch?v=ZYXYAQ3oPuY|language=en|access-date=2022-01-22}}
• Cybersecurity: Cybersecurity is an important risk to any payment infrastructure. While CBDCs offer resiliency by providing a new payment method, they would also represent a critical infrastructure, potentially making them a high-value target for cyber attacks.{{Cite journal |title=IMF Working Papers Volume 2020 Issue 104: A Survey of Research on Retail Central Bank Digital Currency (2020) |url=https://www.elibrary.imf.org/view/journals/001/2020/104/001.2020.issue-104-en.xml |access-date=2024-08-28 |website=IMF eLibrary |language=en |doi=10.5089/9781513547787.001}}
• Government social manipulation:
• Digital currency "will simply become an extension of the surveillance state" and "it could see citizens fined in a split second for behaviors deemed undesirable. Dissidents and activists could see their wallets emptied or taken offline."
• Limiting individual freedom: "Digital currencies could also empower the state to make it impossible to donate to a vocal NGO"
• Limiting or prohibiting purchases of products: Digital currency could prohibit a "purchase alcohol on a weekday. "
• Digital currency "is also programmable. The government could theoretically give out money that expires within a certain period of time or money that could only be used on certain items, which could be used to induce behaviour that the government is seeking."

• Bank for International Settlements
• E-Cedi
• ENaira
• Digital renminbi
• Digital rupee
• Inflation targeting
• mBridge
• M-Pesa
• Zero lower bound

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{{Wikinews|UK Treasury considering plans for digital pound, economic secretary says}}

• [https://www.atlanticcouncil.org/cbdctracker/ Atlantic Council CBDC Tracker]

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Category:Monetary reform

Category:Numismatics