Christine Lagarde: ‘Central Bank digital currency is coming alive’
Central banks will start issuing national digital currencies in the future, according to a study by the International Monetary Fund as a replacement for cash and to improve the efficiency of the financial system.
The IMF and the World Bank conducted a survey of representatives of the Central Banks of all member countries regarding the use of the possibilities of fintech technologies. IN document it is noted that central banks of various countries are considering the possibility of introducing some form of central bank digital currency (CBDC).
According to the IMF, Uruguay has already launched a pilot CBDC program, and China, Sweden, Ukraine, the Bahamas and the Caribbean Union are preparing to test their systems. In addition, a number of Central Banks are conducting research on the potential impact of national digital currencies on financial stability, the structure of the banking sector, non-bank financial institutions and monetary policy..
According to the report, incentives to advance in this direction for financial institutions of developed and developing countries are different. The former seek to create an alternative to cash, due to the reduction in the frequency of their use. Emerging market economies plan to use CBDCs to reduce banking costs and make the system accessible even to citizens, living away from physical branches of financial institutions.
Most Central Banks are not interested in issuing anonymous digital currencies, because they want retain the ability to track transactions by the authorities if necessary. However, some are considering the option of allocating separate groups of tokens for various types of assets and large operations, as well as creating tools for their verification.
Earlier, the IMF and the World Bank themselves created a prototype of a digital currency to study the features of its use..
text: Ivan Malichenko, photo: Shutterstock