According to a survey by the Bank for International Settlements (BIS), nine out of ten central banks worldwide are looking into the possibility of developing digital currencies (CBDCs).
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The survey also found that more central banks are developing or testing a retail CBDC, which is a digital currency for use by consumers, than a wholesale CBDC, which is for banks.
The study released Friday by the BIS, which brings together several central banks, presents the results of a survey of 81 central banks conducted in October 2021. The report examined the extent to which banks are committed to CBDC work and their motivations and intentions for issuing CBDCs. The BIS is owned by 63 central banks, representing about 95% of global GDP.
More than half of the central banks surveyed are either developing CBDCs or conducting "concrete trials," according to the findings. About 20% are developing or testing a retail CBDC, twice as many as central banks working on a wholesale digital currency.
Around the world, central banks are actively exploring CBDCs as economies seek to strengthen their digital payments and banking infrastructure. From potentially improving financial inclusion to speeding up cross-border remittances, CBDCs hold great promise in theory, but with China leading the way in developing and testing a digital yuan, some governments around the world also see CBDCs as a threat to monetary sovereignty.
In September 2021, the BIS directed central banks around the world to begin work on CBDCs. According to the Atlantic Council's CBDC tracker, 87 countries representing more than 90% of the global economy are working on these digital currencies.
"On average, nearly six in 10 central banks surveyed said this growth has accelerated their work on CBDCs," the report said.
The countries represented in the BIS survey account for about 76% of the world's population, and 56 of the central banks surveyed are from emerging and developing economies.
While central banks in the Bahamas, China and Nigeria have already issued or are testing a retail CBDC, the survey found that other countries are likely to follow, 68% in the "foreseeable future."
In addition to questions about CBDCs, the survey also asked central banks about stablecoins (cryptocurrencies that are tied to the value of other assets or currencies, such as the U.S. dollar) and cryptocurrencies in general.
"Central banks' expectations that stablecoins will grow and become widely used and accepted as a means of payment differ depending on the type of stablecoin," the report said. Central banks appear to believe that stablecoins backed by a single currency will be more successful as a means of payment than other types of commodity-linked stablecoins or other cryptocurrencies.
About 70% of central banks are studying the potential impact of stable currencies on monetary and financial stability, while about a quarter are exploring the use of cryptocurrencies.
This article was translated by Marina Lammertyn.