There have been numerous strong research papers covering Central Bank Digital Currencies (CBDC). Last month, the International Monetary Fund (IMF) produced one that pulls together the published research in a structured way.
It does so by exploring the variety of potential motivations that might drive a retail CBDC issuance, the design considerations that follow, and the legal, governance and cybersecurity aspects.
In terms of motivation, the reasons to issue a CBDC will vary significantly from one country to another. One spur may be to increase competition where there are a small number of payment providers. Certainly, for China and Sweden, monopolies or oligopolies are a major driver. In these cases, a CBDC is desirable because private companies could have insufficient cybersecurity, or become inefficient due to a monopolistic position or exploit their position either via pricing or selling customer data.
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