Top central banker Agustín Carstens pushed back on claims that China could capture a “first-mover advantage” over the U.S. by issuing a central bank digital currency (CBDC) before the country whose sovereign coin has lined international monetary reserves for decades.
“Much of this rhetoric is overblown,” Carstens, general manager of the Bank for International Settlements (BIS), said at the Peterson Institute for International Economics on Wednesday, without naming either country (but referencing both in his footnotes). He shot down assertions that any CBDC could win a geopolitical reserve currency catfight “owing to its digital nature alone.”
The comments highlight growing international intrigue over how digital currencies might shape the world’s two largest economies and their global monetary prominence. China’s digital yuan, perhaps the largest and most advanced CBDC project to date, is already being rolled out while the Federal Reserve continues to explore the concept of a digital dollar.