Central banks set out ground rules for digital currencies • NFCW

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By Tom Phillips ^[2] • 12 October 2020 • Updated 12 October 2020 • nfcw.com ^[3]

BIS report on central bank digital currencies 2020

A working group set up by seven central banks and the Bank for International Settlements (BIS) has laid out a set of ground rules for the successful issuance of central bank digital currencies (CBDCs).

CBDCs must be resilient, secure, convenient, available at low cost, be underpinned by appropriate standards and a clear legal framework, and have an appropriate role for the private sector, the working group says in a new report.

There are three key principles on which any CBDC should be based, Central bank digital currencies: foundational principles and core features ^[4] says:

Coexistence with cash and other types of money in a flexible and innovative payment system
Any introduction should support wider policy objectives and do no harm to monetary and financial stability
Features should promote innovation and efficiency.

“A CBDC robustly meeting these criteria and delivering the features set out by this group could be an important instrument for central banks to deliver their public policy objectives,” the working group states.

“A CBDC could promote more resilient, efficient, inclusive and innovative payments, depending on jurisdictional circumstances

Central banks set out ground rules for digital currencies • NFCW

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