IMF Survey: Almost All Central Banks Plan To Issue Digital Currencies
The International Monetary Fund (IMF) asserts that central banks may be planning to issue digital currencies in the near future, as reported by the IMF on June 27
The paper is based on a survey conducted by the IMF and World Bank that tested fintech solicited answers from financial institutions within all member countries. According to the full paper, the conclusions are based in part upon the 96 received responses.
As per the paper, several central banks hailing from different countries are considering implementing some form of Central Bank Digital Currency (CBDC). Reportedly, Uruguay has already launched a CBDC pilot program and other countries including Bahamas, China, Eastern Caribbean Currency Union, Sweden, and Ukraine are “on the verge” of testing their systems.
Moreover, a number of nations are reportedly researching the potential impact of CBDC’s of the nation’s financial stability, its banking sector, the entry of nonbank financial institutions, and monetary policy transmission.
The report further notes that the motivation behind offering a CBDC varies. For instance, emerging economies are looking to reduce banking costs and to avail banking services to unbanked citizens with CBDC’s aid. While developed economies are purportedly seeking an alternative to cash as its frequency of use dwindles.
The report also inferred a similarity, that most central banks are planning to issue an entirely anonymous CBDC, majorly because institutions prefer the transaction to be ultimately traceable by authorities when necessary. Notably, some are also pondering over portioning off a subset of tokens that will be reserved for large holdings and transactions, only these tokens will be traceable.
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