The Bank for International Settlements (BIS), the central bank’s bank, has announced the findings of a 2022 study on central bank digital currency (CBDC) and crypto.
According to a recent article titled “Making Headway,” 93% of the 86 banks surveyed were “engaged in some form of CBDC work, and over fifty percent are carrying out concrete experiments or working on pilots.”
According to the study, these figures demonstrate that the skepticism surrounding the issuance of CBDCs in the short future is disappearing.
However, according to their study, some of these central banks are less likely than others to issue a retail CBDC in the next three years.
The idea of wholesale CBDCs, which would be employed as a means of payment line between private banks, has started to gain traction, with the share of central banks expected to issue this type of currency more than doubling since the last study.
The motivations for providing CBDCs differ, but the document highlights one of the drivers of CBDC development and research as improving cross-border payments.
CBDC research in emerging markets and developing countries, on the other hand, is driven by “financial inclusion-related motivations.”
The development of stablecoins and cryptocurrency assets has prompted traditional financial institutions to adapt.
According to the poll, 60% of the central banks surveyed have expedited their work on CBDCs as a result of the availability of these alternatives.
Currency issuers are likewise concerned about the potential impacts of stablecoin issuance on their economy.
According to the BIS poll, 70% of these central banks are investigating the potential for instability caused by stablecoins in their economies, and 40% have investigated the share of usage that crypto assets and stablecoins have in their jurisdictions.
Stablecoins and crypto assets, on the other hand, are rarely used outside decentralized finance platforms and cryptocurrency trading exchanges.
According to central banks, they are only used infrequently to complete remittances and retail payments.
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