Central Bank Guvs Unsure About CBDC
According to central banks around the world, digital currency regulation is slow. Central bank governors all over the world are investigating the possibility of a Central Bank digital currency.
Technology, according to experts, is one of the most important enablers of the central bank’s digital currency.
This was revealed during a panel discussion with central bank governors from South Africa, Peru, and Israel at the World Economic Forum in Davos, Switzerland.
In 2020 and 2021, the World Economic Forum hosted the Digital Currency Governance Consortium. The consortium has two phases and is currently investigating the second. Phase one saw the forum release the White Paper Series Compendium report.
This phase is complete, and phase two will investigate the macroeconomic effects of digital currencies and inform approaches to digital currency regulation. The Central Bank of Israel is one of many banks investigating the possibility of digital currency. Since then, the bank has built a central bank digital currency hub, which has provided some benefits.
While Phase Two is currently underway, governors from various countries agree that a discussion with policymakers about the transition to digital currency is required.
According to the forum, while technological development remains an important goal, the time has come for the public sector to play a more decisive role. As new payment methods emerge, appropriate regulatory frameworks will be critical.
Soon, the public sector will make critical decisions that will shape the trajectory of digital currency development, such as regulatory decisions, improving payment system efficiency, resilience, and competitiveness, and deciding whether to issue a central bank digital currency.
(With inputs from Shikha Singh)
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