CBDCREGULATION

Central Banks from multiple countries team up to push progress, with over 18 countries already having plans for digital currencies.

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Central Banks from multiple countries team up to push progress, with over 18 countries already having plans for digital currencies.

On the 21st of the UK time, the Bank of England officially announced the formation of a group with multiple central banks to explore possible use cases for central bank digital currencies.

Table of Contents

  • Six central banks from the UK, Canada, Japan, Europe, Sweden, and Switzerland have formed a central bank digital currency (CBDC) group to explore use cases.
  • The group will be overseen by the Bank for International Settlements (BIS) and will closely collaborate with the Financial Stability Board and the Committee on Payments and Market Infrastructures.
  • Over 18 countries have already initiated CBDC projects.

On the 21st, the Bank of England released a statement announcing the establishment of a CBDC group with the Bank of Canada, Bank of Japan, European Central Bank, Sveriges Riksbank, and Swiss National Bank to evaluate the application scenarios, cross-border interoperability, and technical design of CBDCs.

This group will be supervised by the Bank for International Settlements (BIS), with Benoit Coeure, Head of the BIS Innovation Hub, and Jon Cunliffe, Deputy Governor of the Bank of England, serving as co-chairs. Since June last year, the BIS has been advocating for international cooperation in financial innovation, and this group will closely collaborate with relevant organizations or forums such as the Financial Stability Board and the Committee on Payments and Market Infrastructures of the BIS.

Progress of Various Central Bank Digital Currencies

In the aforementioned group, Japan, Canada, and Switzerland are conducting research on CBDCs, while Sweden has already planned to launch the e-Krona.

Bank of England Governor Mark Carney has openly expressed an open attitude towards CBDCs and mentioned the possibility of digital currencies replacing the US dollar. European Central Bank President Christine Lagarde also stated last year that they would actively explore the potential of CBDCs.

The collaboration among these central banks also indicates the possibility of widespread adoption of CBDCs internationally, even though countries that have already launched CBDCs have not yet seen successful cases. However, with China vigorously promoting blockchain and planning to trial digital yuan this year, other countries are becoming more proactive.

Amid escalating US-China competition, although US authorities have not taken proactive steps towards issuing a digital dollar, political representatives and former CFTC chairmen are actively advocating for the implementation of a digital dollar in an attempt to maintain the international status of the US dollar.

Currently, there are 18 countries with CBDC projects (as shown in the figure below), and although the scale is relatively small, there is an expectation for clear development following the launch of digital yuan.

Related Readings

  • The IMF predicts that central banks worldwide will issue digital currencies (CBDCs).
  • Nearing widespread adoption! The People's Bank of China has completed the "top-level design" of its digital currency and will not allow exchange with virtual currencies.

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