Today the Bank for International Settlements (BIS) published a paper on cross border central bank digital currency (CBDC) in conjunction with the IMF and World Bank. It urges collaboration in designing CBDCs to enable cross border payments.
“If CBDCs are not designed with the international dimension in mind, fragmentation of CBDC systems similar to the existing fragmentation of payment systems is possible,” says the paper. Hence CBDC presents a “clean slate” opportunity.
A G20 agenda item is to improve cross border payments which are slow, expensive, inefficient and opaque because of intermediaries. They also suffer from a mismatch in operating hours. If central bank digital currencies interoperate, all of these issues could be addressed.
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