This morning, the BIS Innovation Hub published a report for the G20 on the lessons learnt from its various central bank digital currency (CBDC) projects across the world. The paper critically assesses the desirability, feasibility, and viability of wholesale and retail CBDCs for domestic use cases, as well as the potential of digital currencies for cross-border use. It highlights some of the challenges central bankers will face as their economies go digital and prepare to roll out a new – potentially disruptive – form of public money.
In recent years, the BIS Innovation Hub has partnered with central banks, financial institutions, and the private sector in a dozen projects to help shape research efforts into the development of CBDCs. Most initiatives have focused on either cross-border wholesale (e.g., Jura, Dunbar, and mBridge) or domestic retail challenges (e.g., Rosalind and Polaris). But the BIS has also worked on a domestic wholesale CBDC project in Switzerland (Helvetia), as well as on a cross-border retail one (Icebreaker) with Sweden, Norway, and Israel.
These studies have helped the BIS understand what is desirable (from an individual and societal perspective), feasible (in a technical, legal, and regulatory sense), and viable (mainly in economic terms), carrying forward practical lessons for policymakers as they develop the technical capacity to make a future launch decision.
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