- A BIS survey has revealed that more central banks are exploring central bank digital currencies (CBDCs)
- The survey has found that 94% of 86 central banks are examining digital currencies
- This has marked an increase from 90% of 81 respondents in the 2021 survey
A recent survey by the Bank for International Settlements (BIS) has revealed that more central banks than ever are exploring the potential of central bank digital currencies (CBDCs). Published on Friday, the survey found that 94% of the 86 participating central banks are examining digital versions of their national currencies. This marks an increase from 90% of 81 respondents in a similar 2021 survey.
Wholesale CBDCs Preferred Over Retail
CBDCs have been on the agenda for central banks for many years, and respondents to the survey indicated a higher likelihood of issuing a wholesale CBDC rather than a retail version within the next six years. Wholesale CBDCs would be available only to banks and financial institutions, while retail CBDCs could be used by the general public for everyday transactions.
Global interest in CBDCs has been on the rise, with China at the forefront of CBDC development, launching its digital yuan in 2020. Nigeria and the Bahamas were among other nations to launch their own digital currencies.
“For retail CBDCs, more than half of central banks are considering holding limits, interoperability, offline options, and zero remuneration,” the BIS reported. These considerations are critical for ensuring the practicality and security of CBDCs for everyday use by the public.
Stablecoins Still Have Limited Reach
The survey, conducted between October 2023 and January 2024, also shed light on the current use of stablecoins—cryptocurrencies pegged to assets like the dollar or gold. It found that stablecoins are rarely used for payments outside the cryptocurrency ecosystem, indicating that their adoption for mainstream transactions remains limited.
As the digital currency landscape continues to evolve, the findings from the BIS survey underscore the significant interest and efforts of central banks worldwide in exploring and potentially implementing CBDCs. This trend reflects a broader movement towards modernizing financial systems and enhancing the efficiency and security of monetary transactions.
