A group of seven central banks together with the Bank for International Settlements (BIS) have published a report laying out the key requirements for creation of a central bank digital currency.
The report, ‘Central bank digital currencies: foundational principles and core features’, was compiled by the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, Sveriges Riksbank, the Swiss National Bank and the BIS.
It highlights the key principles and core features of a CBDC, but does not give an opinion on whether to issue, although the race is clearly on to catch up with China’s trailblazing exploits and beat off private initiatives such as facebook’s Libra.
The document stresses that any introduction should support wider policy objectives and do no harm to monetary and financial stability. Coexistence with cash and other types of money is considered essential, as well as core features that promote innovation and efficiency.