In the last few days, several central banks made announcements relating to central bank digital currencies (CBDC). This follows recent major reports on CBDC from a group of seven central banks, the European Central Bank, the Bank of Japan and others.
Stefan Ingves, the Governor of RiksBank, Sweden’s Central Bank, published a paper on the future of money and payments. Sweden is seen as one of the more advanced economies in terms of CBDC testing and is currently conducting distributed ledger technology (DLT) pilots with Accenture’s help. But the country has not yet committed to proceeding with a CBDC.
However, his own vision includes a Riksbank e-krona that is legal tender. He also hopes for a state-issued ID card, 24/7 instant payments using state money both domestically and between currencies across borders.
In an interview with Reuters, Finland’s central bank Governor Olli Rehn spoke about a digital euro’s potential. He noted that Europe had moved from a ‘late comer’ to working on the front row with others. As usual, he emphasized no decision has yet been made but said that “it is very likely that we will see a digital euro sometime in the course of the coming decade in one form or another.”
Banco de Espana published a report on its research plans between 2020 and 2024. There wasn’t much detail about its CBDC plans, but it raised the point of combining it with identity. Apart from passports, Europe doesn’t have an identity system across the block.
It said it would research “the implications of the introduction of a central bank digital currency on the financial system and the economy as a whole, considering different design proposals and including aspects related to digital identification.”
The Bank of Canada is hiring an economist to monitor developments in the CBDC sector and conduct in-depth research. More specifically, to provide analysis relevant for the “potential development of a CBDC”.
Meanwhile, later today, the IMF will be sharing its vision on the future of payments. It published a synthesis of CBDC research three months ago. The IMF and World Bank are collaborating with numerous central banks in BIS research into CBDC for cross border payments.