The Atlantic Council reported that 134 countries, representing 98% of the global economy, are exploring central bank digital currencies (CBDCs), a sharp increase from 35 in 2020.
What is the meaning: The rise of global central bank digital currency (CBDC) initiatives highlights a significant shift towards modernizing financial systems, improving transaction efficiency and resolving cross-border payments challenges.
Key details:
- China’s digital yuan (e-CNY) is leading global efforts, with transaction volumes set to reach $986 billion by June 2024.
- 66 nations have made progress in developing CBDCs.
- 44 countries, including Australia and Singapore, are running pilot programs.
- The Bahamas, Jamaica and Nigeria have already launched CBDCs.
- BRICS countries are testing CBDCs as part of an alternative payment system to the dollar.
- More details of the Atlantic Council.
How it works: CBDCs allow central banks to digitize national currencies, allowing for more efficient and secure transactions, especially cross-border.
World Economic Forum: In April, a report of the World Economic Forum revealed that 98% of central banks are exploring central bank digital currencies (CBDC).
- A major challenge identified is “disparate settlement cycles” in cross-border transactions, where wCBDCs could enable nearly 24/7 global settlement operations.
PH CBDC: The Central Bank of the Philippines (BSP) plans to issue a wholesale central bank digital currency (CBDC) by 2029 under Project Agila.
- The initiative aims to modernize the Philippines’ large-value payments system and improve transaction efficiency.
- Timeline:
- 2022: Launch of the Agila Project.
- 2023: Hyperledger Fabric is chosen.
- 2024: Pilot completion target for the fourth quarter.
- 2029: target launch.
- Current phase: Proof of concept, proof of distributed ledger technology and tokenization.
what to look at: : As CBDC initiatives grow, cross-border projects like mBridge and the United States’ participation in Project Agorá could reshape international financial systems.
What’s next? Cross-border CBDC projects like mBridge and US participation in Project Agorá could transform global financial systems.
worth reading: According to the latest BitPinas article, 131 countries were exploring or had developed CBDCs as of September 2023, and 11 had fully launched their systems.
This article is published on BitPinas: Report: The number of countries now exploring CBDCs
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