LONDON, Sept 17 (Askume) – Some 134 countries accounting for 98% of the global economy are currently exploring digital versions of their currencies, with about half of them at an advanced stage, with pioneers such as China, the Bahamas and Nigeria starting to look at options being used.
Research released on Tuesday by the US-based Atlantic Council think tank showed that all G20 countries are currently studying a central bank digital currency (CBDC), and a total of 44 countries are testing it.
The number has increased from 36 a year earlier and is part of a global effort by authorities to respond to the decline in cash use and threats posed by the likes of bitcoin and “Big Tech”’s ability to print currencies.
Josh Lipsky and Ananya Kumar of the Atlantic Council said one of the most notable developments this year is the significant growth in CBDCs in the Bahamas, Jamaica, and Nigeria, just three of the countries that have launched a CBDC.
China is also implementing the world’s biggest pilot programme, with transaction volume for its prototype electronic yuan nearly quadrupling to 7 trillion yuan ($987 billion), according to officials.
“There’s a narrative that countries that have launched CBDCs have had little or no adoption, but in the last few months we’ve seen real adoption,” Lipsky said.
“My prediction is that the People’s Bank of China (China’s central bank) will be fully operational in a year,” he said.
Other major developments include the European Central Bank launching a multi-year digital euro pilot and the United States, which has long stalled on a digital dollar, joining six other major central banks in a cross-border CBDC initiative.
It still lags significantly behind almost all major banks, but Lipsky highlighted that it is one of the countries with the strongest privacy and other concerns about CBDCs.
In May, the US House of Representatives passed a bill banning the direct issuance of a “retail” CBDC (the kind used by the public). The Senate has yet to act, but it remains a hot issue in the presidential campaign between Donald Trump and Kamala Harris.
Since Russia’s invasion of Ukraine and its response to G7 sanctions, the number of interbank “wholesale” CBDC schemes has more than doubled to 13.
The fastest-growing one, codenamed mBridge, connects CBDCs from China, Thailand, the United Arab Emirates, Hong Kong, and Saudi Arabia, and is expected to expand to more countries this year.
Russia is unlikely to be one of them, but its digital ruble pilot means it is now accepted in the Moscow metro and some petrol stations. Iran is also developing a digital rial.
“Regardless of what happens in the U.S. election, the Fed is years behind,” Lipsky said.
(1 USD = 7.0930 RMB)
