During the first quarter, the Bank for International Settlements (BIS) surveyed 50 central banks about the potential use of central bank digital currencies (CBDC) for cross border payments. The indecisive results indicate it’s still early days, especially since most countries have yet to decide whether to launch a CBDC. But it looks like CBDCs might trigger greater foreign exchange controls.
One area where there was slightly more clarity was whether countries would allow incoming foreign visitors to use the local retail CBDC while visiting, as they would with physical cash. Only 29% of respondents had a clear view, made up of 25% saying visitors can use the CBDC, and 4% saying no. This is a relatively simple decision because it maps to current habits.
There was far greater concern about allowing retail CBDC usage outside of the country because of a lack of control.
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