The survey was compiled by BIS at the end of 2019 and contains the answers from 66 central banks around the world.
Twenty-one came from advanced economies and forty-five from emerging market economies (EMEs).
The study firmly concludes that 80% of all participants are in the process of creating their own central bank digital currency (CBDC).
It’s worth pointing out that the General Manager of BIS, Agustin Carstens, recently urged central banks to adopt CBDCs. He noted that they have to stay at the centre of global payment systems as otherwise, they might risk falling behind.
There was also the very real concern when Facebook announced their intention to create their own “Libra” currency, that it could undermine countries and their control of the money supply.
Many, including the UK, Russia, Canada and China are beta testing their own versions now. It appears to be a case of “if you can’t beat them, join them” mentality.
Lithuania, whilst a small country, has the distinction of being the first central bank to launch its own Cryptocurrency, its LBCOIN. Its part of a trial central bank digital currencies and blockchain technology in everyday use.
Central Banks Crypto Coins
Commenting on the new currency, Marius Jurgilas, deputy governor of Lithuania’s central bank said to Reuters: “No one in the central bank community was thinking about digital currency seriously before we realized that there is a legitimate threat that someone else will take our space… We need to provide society with what it wants.”
Central Banks already have a form of digital currency?
Yes. They generate new “money” as and when they feel the need to achieve their mandate. Often it’s not a physical note that is issued, more an entry into a computerised ledger, which is what happens with BTC and the blockchain.
It’s obvious they do not want to lose control, but kind of defeats some of the reasons why people want to use another Crypto.
It is also unlikely that CBDC’s will generate an increase in value (profit) for investors, unlike that which I anticipate from BTC and others in my portfolio. I am buying them for a return on investment. Using them is a secondary matter at this time.
The Bank of England has dedicated this report to it, clearly distinguishing between the “electronic money of the Central Bank that has existed for decades” and the central bank digital currencies (CBDC) that are being considered.
Although in many respects a CBDC is similar to electronic money, its feature, as emphasized in the Bank of England, is that it has even more functionality than cash, and, very importantly, exists on the basis of a “separate operating structure.”
Amusingly the new Governor of the Bank of England recently criticised BTC and other forms of crypto as being too risky and “unsuitable as a means of payment”... on the other hand, he believes that stable coins (those his and other banks will produce) are a great idea!
Here is an article that goes into more detail on the subject, however, if you don’t wish to get sidetracked, just know that it’s going to happen and relatively soon:
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