90% of Central Banks are Investigating CBDCs, BIS Survey

90% of Central Banks are Investigating CBDCs, BIS Survey
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Opinion

90% of Central Banks are Investigating CBDCs, BIS Survey

Nine out of ten central banks are investigating central bank digital currencies (CBDCs).

05/10/2022

Central Bank Digital Currency could revamp global economy: Report

According to a BIS survey, nine out of ten central banks are investigating central bank digital currencies (CBDCs), with more than half actively developing CBDCs or conducting concrete experiments.

According to the survey, more central banks are working on retail CBDCs, intended for domestic consumer usage, rather than wholesale CBDCs, intended for institutional purposes such as cross-border payments between banks.

Central Bank Interest in CBDCs Increasing Globally

The BIS Monetary and Economic division released a report on May 6 detailing the results of a poll performed in October-December 2021 that included 81 central banks representing 76 percent of the world’s population, including 25 advanced economies.

Key findings include that 90% of central banks are looking into CDBCs. Currently, 26% are doing CDBC pilots. Furthermore, more than 60% are undertaking proof or work.

The report also discovered that the percentage of central banks investigating CDBCs has increased from 83 percent in 2020. According to the BIS, this surge was fueled in part by the Covid-19 pandemic and the rise of stablecoins, particularly in wealthy economies.

Retail CBDCs a Priority

Work on retail CBDCs is more advanced in many nations than work on wholesale CBDCs, according to the research, with the following findings:

“Globally, more than two-thirds of central banks believe they are likely to or may issue a retail CBDC in the near or medium future.”

That’s not to suggest there isn’t interest in wholesale CBDCs; the survey discovered that cross-border transfer times and complexity are important drivers of wholesale CBDC development:

The survey discovered that “work on wholesale CBDCs is increasingly being motivated by factors linked to cross-border payment efficiency.” “Central banks believe that CBDCs have the potential to alleviate significant pain points such as the limited operation hours of present payment systems and the length of current transaction chains.”

By Elah Mae Ariate Wozinga Staff

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