In order to use some of the advantages of digital currencies, initiatives to make Central bank digital currencies (CBDC) available to the public under the control of national central banks continue to increase worldwide.
We see that CBDC studies have become widespread in many countries as a result of the adoption of the cryptocurrency ecosystem by millions of people around the world, especially as the use of stablecoins pegged to the US dollar has become widespread due to high inflation. The interest of financial circles in CBDCs is also increasing day by day. Recently, global payment giant Mastercard announced that it has created a central bank digital currency (CBDC) programme with its partners, including Ripple and blockchain development company Consensys. Mastercard's Head of Digital Assets and Blockchain Raj Dhamodharan said in a statement that the new CBDC programme is designed to "encourage collaboration with key players in the field".
The central banks of more than 100 countries are actively evaluating digital currencies in all aspects. We have compiled the stage of CBDC studies in some countries:
Having completed the CBDC pilot, the Reserve Bank of Australia announced in a 44-page report that it found CBDCs useful in four main areas. The report covered four key areas that could be improved by a CBDC, including enabling smarter payments, where the CBDC pilot programme enabled a tokenised CBDC to enable a range of complex payment arrangements not supported by existing payment systems.
13 Russian banks participated in the CBDC pilot programme conducted by the Bank of Russia (BoR). The pilot programme started on 15 August 2023. Users will be able to use digital rubles to make purchases at 30 retail locations spread across 11 Russian cities during the test period. According to a statement, the first phase of the pilot programme focuses on facilitating basic procedures such as the creation and funding of digital ruble accounts (also known as digital wallets), digital ruble transfers between individuals, simple automatic payments, the use of QR codes for transactions related to goods and services. First Deputy First Deputy Governor of the Bank of Russia Olga Skorobogatova notes that the most important stage of the project will be the launch of pilot operations using real digital rubles. By 2025, individuals and organisations will be able to effectively use the national digital currency on their own initiative.
The Bank of Japan (BOJ) has begun a series of talks with 60 companies as part of a pilot programme aimed at developing a digital yen by the end of July 2023. According to a statement by the central bank, the discussions cover many topics, including the business and technological aspects of making retail payments using a central bank digital currency (CBDC). However, the fact that a large number of major Japanese companies have been included in the list of 60 firms selected for these discussions is seen as a clear indication that Japan is taking significant steps towards potentially launching a digital yen. Participants include well-known organisations such as electronics giant Sony, leading convenience store operator Lawson, the finance division of automobile giant Toyota and East Japan Railways.
Yi Gang, Governor of the People's Bank of China, China's central bank, stated that the transaction volume for the Digital Yuan, China's central bank digital currency (CBDC), has reached 250 billion USD in just a year and a half since the start of pilot tests. Yi stated that about 950 million transactions have been made from about 120 million wallets since the e-CNY was first launched in January 2022. In Chinese President Xi Jinping's speech at the 2023 Shanghai Cooperation Organisation (SCO) Summit, he stressed the importance of central bank digital currencies (CBDCs) and proposed expanding the use of local currencies among SCO countries, promoting cooperation in sovereign digital currencies and establishing SCO development banks.
The Reserve Bank of India (RBI) is actively exploring the potential of the digital rupee for cross-border transactions. As a matter of fact, according to the Economic Times, the RBI is in talks with the central banks of about 18 countries. Making a statement on the subject, RBI Governor Shaktikanta Das emphasised the importance of foreign trade infrastructure for the digital rupee. Das underlined the potential for cross-border transactions to become faster, more organised and cost-effective with the digital rupee and said, "This is another area that needs a lot of attention. We are in constant dialogue with other central banks that have implemented or are implementing CBDCs."
According to the annual report published by the Reserve Bank of India (RBI) on 30 May 2023, it was stated that the scope of the CBDC was planned to be expanded and more banks were aimed to be included in the process. In India, 8 banks are actively accompanying CBDC activities.
The Bank of Israel says it is preparing an action plan for the potential issuance of a central bank digital currency (CBDC), although no official decision has yet been made. Indeed, the Bank of Israel's Steering Committee had outlined possible scenarios for the development and deployment of a CBDC, calling the digital shekel "SHAKED". Among the various scenarios that could lead to the issuance of a digital shekel, the committee includes increased stablecoin activity.
United Arab Emirates (UAE)
The Central Bank of the UAE (CBUAE) has announced that it will implement the Central Bank Digital Currency (CBDC) strategy titled 'Digital Dirham'. CBUAE announced that the first phase of the CBDC strategy will focus on the following three main elements: soft launch of mBridge, proof-of-concept work for bilateral CBDC bridges with India, and proof-of-concept work for local CBDC issuance covering wholesale-retail use. CBUAE has undertaken several CBDC initiatives in recent years, including the "Aber" Project with the Central Bank of Saudi Arabia in 2020.
Nigeria was the first African country to issue a digital version of its national currency in October 2021. The Central Bank of Nigeria (CBN) wants to develop a new system for the digital currency eNaira. According to Bloomberg, the CBN wants to develop its own software for the digital currency and thus retain full control.
The Swiss National Bank (SNB) is preparing to launch a wholesale central bank digital currency (CBDC) pilot backed by the country's SIX digital exchange. SNB does not favour the retail use of CBDCs. SNB President Thomas Jordan confirmed that the pilot is not "just an experiment" but "real money equivalent to bank reserves". "The aim is to test real transactions with market participants," Jordan said.