OMFIF: Central banks see CBDC as a way to protect against dollar dominance

41% of countries expect to launch their own national cryptocurrencies by 2028

28.12.2023 - 12:50

200

2 min

What’s new? According to a study by the Official Monetary and Financial Institutions Forum (OMFIF), 41% of central banks will launch their own digital currencies (CBDCs) by 2028. 70% of institutions say their CBDCs will become widespread within the next ten years. With the global dominance of the dollar, analysts say many countries see the creation of national cryptocurrencies as a way to preserve monetary sovereignty.

OMFIF’s report

What else is known? The study shows that developing countries with the help of CBDCs expect to increase access to financial services, as well as the competitiveness of their own economies. In turn, advanced economies seek to preserve the status of their national currencies by launching such assets. Together, both of these factors threaten the dominance of the US dollar, given that the BRICS countries have also announced plans to de-dollarize, OMFIF reports.

Thus, 38% of countries name the main motivation for launching a national cryptocurrency as the expansion of citizens’ access to financial services, and another 17% seek to reduce the share of the dollar in settlements for foreign economic activity. Only 19% of central banks do not plan to launch CBDCs.

Earlier, US Senator Warren Davidson called for a ban on the issuance of the digital dollar, calling it a “threat to Western civilization” because of the possibility of total control. The BofA believes that the Fed will not issue a digital dollar without the support of Congress.

BIS presents its anonymous CBDC project

The project has two prototypes, one with a greater emphasis on privacy, and the other on security

Agustín Carstens, head of the Bank for International Settlements (BIS), called CBDCs a key element in the transformation of the financial system. The head of the Central Bank of Singapore stated that CBDCs are one of the contenders for the role of digital money, along with stablecoins and tokenized bank deposits.

Author: