CBDC (www.CBDC.cc) is an encrypted digital currency website issued by central banks around the world.
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Telegram：t.me/CBDCss
Twitter：twitter.com/CBDCcc
Key findings
Timeline: Race for the future of money
The ABCs of CBDCs
What is a CBDC?
A Central Bank Digital Currency (CBDC) is the digital form of a country’s fiat currency that is also a claim on the central bank. Instead of printing money, the central bank issues electronic coins or accounts backed by the full faith and credit of the government.
But don’t digital currencies already exist?
There are already thousands of virtual currencies, commonly called cryptocurrencies. These could be centralized, but they are not from the government—for example, think of the Facebook-initiated Diem. Fully decentralized versions of cryptocurrencies include bitcoin and its competitors. Cryptocurrencies run on distributed-ledger technology, meaning that multiple devices all over the world, not one central hub, are constantly verifying the accuracy of the transaction.
So why would a government get into virtual currencies?
There are a lot of reasons to explore virtual currencies, depending on the economic situation within a country. Here are just a few according to the International Monetary Fund: CBDCs are more cost efficient than physical cash as they have lower transaction costs; they can promote financial inclusion, meaning those who are unbanked can get easier and safer access to money on their phone; they can compete with private companies that need incentives to meet transparency standards and limit illicit activity; and they can help monetary policy flow more quickly and seamlessly.
What are the challenges?
There are several challenges, and each one needs careful consideration before a country launches a CBDC. Citizens could pull too much money out of banks at once and purchase CBDCs, triggering a run on banks. Centralizing, through the government, a system designed to be private may produce backlash from users and create cybersecurity risks. Regulatory processes are not updated to deal with the new forms of money and need to be made more robust before adopting this technology.
What are the national security implications of a CBDC?
The United States is able to monitor and regulate most digital payment flows of dollars all over the world. But new payment systems could limit the ability of policymakers to track cross-border flows. In the long term, the absence of US leadership and standards setting can have geopolitical consequences, especially if China maintains its first-mover advantage in the development of CBDCs.
