November 29, 2023

WEF releases central bank digital currency adaptation guide

WEF releases central bank digital currency adaptation guide

World Economic Forum (WEF) in conjunction withThe largest central banks in the world have developed a guide to assess the prospects for the implementation, selection and development of policies regarding national digital currencies (CDBC).

The document consists of 28 pages and providesdetailed information about the possible advantages and disadvantages of using each of the possible types of central bank digital currencies (retail, wholesale, hybrid) for countries of the world with different levels of development. Its main purpose is to help governmentsdetermining the feasibility of implementing CDBC and the most appropriate options.

According to the developers, central banks shouldact carefully and carefully analyze potential risks, since any implementation of CDBC will have a significant impact not only nationally but also internationally.

In the manual, for example, the document states thatThe wholesale digital currency of the central bank can reduce the cost of cross-border payments, but it will not bring tangible results for countries that already have a highly efficient system.

Similarly, retail CDBCs can help reduce the costs and challenges of managing money, but will require significant investments in cybersecurity.

WEF representatives argue that they do not oppose the introduction of national digital currencies, but want to help central banks evaluate and adapt the protocols to their needs and current conditions.

Experts from more than 40 central banks, research institutes and financial institutions participated in the development of recommendations.

In addition, recently central banksJapan, the European Union, the United Kingdom, Sweden, Canada and Switzerland, together with the Bank for International Settlements, have created a working group to conduct research in the field of central bank digital currencies.