Multiple central banks, including the Bank of England and the European Central Bank (ECB), have declared that their central bank digital currencies (CBDC) won’t be programmable money. A key motivation was to address fears that governments could direct how you spend your money. Russia’s not quite so bothered about launching a programmable CBDC.
So if the smart contracts are not at the base layer, where will they be? Will every bank and payment provider implement their own programmability? Or a better question: who will deploy the programmability function for payments?
These are the sorts of issues that a team at Barclays addresses in a paper exploring the ‘functional consistency’ of money. While the title may sound a little abstract, the content is pragmatic. One of the authors, Dr. Lee Braine, is a member of the Bank of England’s CBDC Technology Forum for the digital pound.
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