Central Bank Digital Currencies (CBDCs)

Understanding the future of sovereign digital money and its role in tomorrow’s financial system.

CBDCs Around the World

A compact overview of selected Central Bank Digital Currency projects.

🇨🇳

China

Pilot

Digital Yuan / e-CNY

🇪🇺

European Union

Preparation

Digital Euro

🇺🇸

United States

Research

CBDC research

🇧🇸

Bahamas

Live

Sand Dollar

🔵 Research 🟠 Pilot 🟣 Preparation 🟢 Live

Retail vs Wholesale CBDCs

CBDCs can be designed for everyday public payments or for settlement between financial institutions.

Retail CBDC

For citizens and businesses

Designed for everyday digital payments, similar to digital cash issued by a central bank.

Wholesale CBDC

For banks and institutions

Designed for interbank settlement, securities transactions and financial market infrastructure.

Why Are Central Banks Exploring CBDCs?

Central banks are exploring CBDCs to modernize payment systems, strengthen financial resilience and prepare for the next generation of digital finance.

Faster Payments

Reduce settlement times for domestic and international transactions.

🏦

Financial Stability

Support resilient payment infrastructure during periods of market stress.

🌍

Cross-Border Payments

Improve efficiency and interoperability across international payment networks.

💻

Financial Innovation

Explore programmable money and future digital financial infrastructure.

CBDC vs Stablecoin

Although both exist in digital form, Central Bank Digital Currencies and stablecoins serve different purposes and are issued by different entities.

CBDC

  • Issued by a central bank
  • Sovereign digital money
  • Public infrastructure
  • Supports monetary policy

Stablecoin

  • Issued by private companies
  • Pegged to an asset
  • Used for digital payments
  • Operates on blockchain networks

Potential Benefits of CBDCs

Central Bank Digital Currencies could improve payment efficiency while supporting innovation in financial infrastructure. Their potential benefits depend on design choices and policy objectives.

Faster Settlement

Near real-time payment and settlement infrastructure.

🌍

Cross-Border Payments

Potentially faster and more efficient international transactions.

🔒

Resilience

Support robust and secure payment infrastructure.

💡

Innovation

Enable programmable payments and new financial services.

Potential Challenges

While CBDCs may offer significant opportunities, their implementation also raises important policy, operational and technological considerations.

🔒

Privacy

Balancing user privacy with regulatory requirements.

🛡️

Cybersecurity

Protecting digital payment infrastructure against cyber threats.

🏦

Banking System

Understanding how CBDCs may interact with commercial banks and deposits.

🌐

Interoperability

Ensuring compatibility across domestic and international payment systems.