Is the issue of Central Bank Digital Currencies (CBDCs) still in the realm of concepts likely to be introduced in the future or has this solution already been implemented in some countries?
The Covid-19 pandemic has resulted in the acceleration of the digitization and Internetization of various aspects of the business activities of companies and enterprises, Internet-implemented processes for the sale of products and services, Internet-implemented payments and settlements, Internet-implemented marketing communications with customers, and so on. Much earlier, in the 1990s, in some countries, the first companies began to develop their business activities, including the sale of certain products and/or services via the Internet, the first Internet businesses began to operate, Internet startups, dotcoms growing rapidly, portals offering Internet information services, earning money from the sale of Internet advertising, and so on. At that time, electronic banking was already developing rapidly, offering its banking services remotely, first to institutional clients, and then to individual clients, to citizens. Electronic banking initially providing remote banking services in the form of so-called home banking, and then at the turn of the century transformed into online banking and then into mobile banking. Successively, therefore, the electronification, digitization and Internetization of banking is progressing year by year. In some countries, as early as the late 1990s, there were already considerations about the future of Internet banking development. The possibility of a full transition of banking to online banking was considered, as well as the full replacement of money existing in traditional form, i.e. in the form of banknotes and coins, to the form of electronic money. Already at that time there were theories suggesting that soon, in a few years, all banking will become Internet banking, that physically existing bank branches will disappear completely, physically existing money will disappear from citizens' wallets and will be completely replaced by its electronic counterpart. A continuation of this kind of considerations is the transition of central banks to a kind of form of electronic central banking and the replacement of traditional money with digital currency generated and introduced into the economy by central banks within the framework of shaped monetary policy. In a situation where the progressive processes of digitization and internetization would also apply to central banking then monetary policy could also be subject to these processes. Well, during the Covid-19 pandemic, there was also an increased interest in the development of central bank digital currencies (CBDCs) in some countries. Some countries have attempted to introduce digital currencies of central banks. An interesting issue is the possibility of involving Blockchain technology in the development of systems based on central banks' digital currencies, which could ensure a high level of security for these digital currencies. However, both the positive aspects of the introduction of central banks' digital currencies for the formation of monetary policy, which would also be implemented more digitally, are still not fully recognized. The negative aspects of the introduction of financial systems and their development based on central banks' digital currencies are also not diagnosed. It is not fully explored what new risks in financial markets can be generated by the introduction of central banks' digital currencies. It is not known how the introduction of digital currencies of central banks could affect the stability of financial systems, the situation in financial markets and the macroeconomic stability of the economy as a whole.
I have described the key issues of the central banking problem in my articles below:
Synergy of post-2008 Anti-Crisis Policy of the Mild Monetary Policy of the Federal Reserve Bank and the European Central Bank
Article Synergy of post-2008 Anti-Crisis Policy of the Mild Monetary...
Analysis of the effects of post-2008 anti-crisis mild monetary policy of the Federal Reserve Bank and the European Central Bank
Article Analysis of the effects of post-2008 anti-crisis mild moneta...
A safe monetary central banking policy as a significant instrument for liquidity maintenance in the financial system
Article A safe monetary central banking policy as a significant inst...
ACTIVATING INTERVENTIONIST MONETARY POLICY OF THE EUROPEAN CENTRAL BANK IN THE CONTEXT OF THE SECURITY OF THE EUROPEAN FINANCIAL SYSTEM
Article ACTIVATING INTERVENTIONIST MONETARY POLICY OF THE EUROPEAN C...
Anti-crisis state intervention and created in media images of global financial crisis
Article Anti-crisis state intervention and created in media images o...
I invite you to get acquainted with the issues described in the above-mentioned publications and to scientific cooperation in these issues.
In view of the above, I address the following question to the esteemed community of scientists and researchers:
Is the issue of Central Bank Digital Currencies (CBDCs) still in the realm of concepts likely to be introduced in the future or has it already been implemented in some countries?
Is the issue of Central Bank Digital Currencies (CBDCs) still in the realm of concepts or has this solution already been implemented in some countries?
What do you think about this topic?
What is your opinion on this issue?
Please answer,
I invite everyone to join the discussion,
Thank you very much,
Best wishes,
Dariusz Prokopowicz
The above text is entirely my own work written by me on the basis of my research.
In writing this text, I did not use other sources or automatic text generation systems.
Copyright by Dariusz Prokopowicz
As part of its ongoing effort to intelligently keep up with technology advancements, Bank Indonesia is now researching the creation of the Digital Rupiah, sometimes referred to as Central Bank Digital Currency (CBDC). Based on this, BI established the Garuda Project, also known as Rupiah Digital, which is in charge of many projects to investigate several design possibilities for Indonesia's CBDC architecture. Reducing the amount of cash in circulation, minimizing the flow of dubious money, and facilitating payments anywhere and anytime are some benefits of adopting digital money. The need for the government to effectively tell the people about the Garuda project (digital rupiah) should be emphasized.
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