Countries representing over 90% of global GDP are exploring CBDCs
The quest to understand the opportunities and challenges of a central bank digital currency, or CBDC, is underway in 81 countries, with five nations fully implementing a digital version of their currency, according to a new tracker from the Atlantic Council.
The Caribbean region is home to all five CBDCs that are currently in use, with The Bahamas, Saint Kitts and Nevis, Antigua and Barbuda, Saint Lucia and Grenada all implementing their digital cash systems.
CBDCs are in their pilot stage in 14 other countries, including South Korea and Sweden, the tracker shows.
Created in 1961, the Atlantic Council describes itself as a nonpartisan organization that seeks to promote U.S. leadership on various world issues. The CBDC tracker, which was unveiled July 22, currently monitors 83 countries and currency unions.
Among the countries with the four largest central banks — United States Federal Reserve, European Central Bank, Bank of Japan and Bank of England — the U.S. is furthest behind in terms of CBDC development.
Related: Reserve Bank of India mulls first steps toward an eventual CBDC
The Federal Reserve has been researching CBDCs for several years now, with Chairman Jerome Powell indicating in January that digital-dollar development is a “very high priority” to combat financial crime. Meanwhile, New York Fed Bank President John Williams believes that the emergence of cryptocurrencies raises challenging questions for central banks.
Related: Fed and Yale researchers lay out 2 regulatory frameworks for stablecoins
China recently indicated that foreign visitors will be allowed to use the digital yuan during the 2022 Winter Olympics — provided they share their passport information with the central bank. A group of U.S. senators that includes Bitcoin proponent (BTC) Cynthia Lummis has urged American Olympians to boycott the digital yuan. According to the South China Morning Post, Beijing responded by telling the U.S. senators to “stop making trouble.”
The People’s Bank of China claims that nearly 21 million people have already opened a virtual wallet for the purpose of using the digital yuan.