Global CBDC plan in the works by International Monetary Fund
- Over 100 countries are exploring a CBDC, while 11 countries have fully launched a CBDC.
- Most CBDC initiatives are hardly concerned with the component of interoperability.
The International Monetary Fund (IMF) is working to create a global central bank digital currency (CBDC) system to facilitate seamless cross-border transactions. IMF Managing Director Kristalina Georgieva made the remarks during a conference in Morocco on 19 June, Reuters reported.
The IMF has been strongly supportive of different CBDC initiatives that the central banks across the world are working on. The global body believes that central banks must build their own digital currencies in order to fight the danger of cryptocurrencies.
Most initiatives, however, are primarily concerned with developing digital versions of national fiat currencies with interoperability mostly as an afterthought, added Georgieva. The few initiatives with cross-border payments limit this feature to only a few neighboring nations.
Georgieva underlined that central banks must prioritize global interoperability in their CBDC initiatives. They should create a standard regulatory framework for digital currencies to enable it.
Georgieva further stated that cryptocurrencies that do not have real-world assets backing them should not be deemed safe, since they are a “speculative investment.” It means that the only cryptocurrencies, backed by assets, are stablecoins.
CBDC finds footing in over 100 countries
The Atlantic Council, a Washington, D.C.-based think tank, has been tracking the status of CBDC projects across the globe.
As per the latest available data, 114 countries, representing over 95% of global GDP, are exploring a CBDC. Moreover, 11 countries, including Nigeria, Jamaica, and the Bahamas, have fully launched a digital currency.
In 2023, over 20 countries will take significant steps towards piloting a CBDC. Australia, Thailand, Brazil, India, South Korea and Russia intend to continue or begin pilot testing in 2023. China’s pilot, which reaches 260 million people, will expand to most of the country in 2023.
At press time, there were nine cross-border wholesale CBDC tests and seven cross-border retail projects.