Central bank digital currencies (CBDCs) will replace cash in the long term, according to Deutsche Bank’s research team.
In its latest edition of the “Konzept” periodical, published Tuesday, the bank said the coronavirus pandemic has accelerated the use of digital payments over cash, and the trend will eventually lead to CBDCs taking over cash.
However, many countries are behind in their progress for digital currencies, said Marion Laboure, a macro strategist at Deutsche Bank. China and Sweden, for instance, are leading the digital currency development. But if other countries do not catch up, “they may find that their companies are forced to adopt the digital currencies and policies of other countries as payment mediums,” said Laboure.
The U.S. and Europe, in particular, need to catch up, according to Laboure. Their development in the area is “too slow,” she said. While both the countries have been studying CBDCs, they do not appear to be in a rush to issue one.
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