Initial enthusiasm for central bank digital currencies (CBDCs) is rapidly waning, according to a recent report from OMFIF’s Digital Currency Institute (DMI).
An annual survey revealed that only 13% of central bankers view CBDCs as a promising solution for cross-border payments, a notable decline from 31% last year. Furthermore, only 10% are still developing the concept, compared to 21% in 2022.
Challenges in the development of CBDCs
Regulatory and technological challenges have generated skepticism among central bankers themselves. Some notable factors include:
Fragmentation in international projects
- mBridge: Led by the People’s Bank of China, it seeks to offer alternatives to the dollar in emerging economies.
- Agora: Backed by the Bank for International Settlements (BIS), it has a more Western focus, but lacks a broad base of support.
Complex governance
Implementing a multicurrency system would require the creation of a supervisory structure similar to the Basel Committee on Banking Supervision, but with greater scope.
Limited adoption
Only a small fraction of financial institutions are prepared to transition to systems like the new Swift messaging format, which has an adoption deadline of November 2025.
Why are they losing support?
One of the main objectives of CBDCs is to counter the dominance of technology giants such as Google, Meta and Alibaba in digital payments. However, the development of these currencies has faced problems such as the possible loss of monetary autonomy and the lack of consensus on regulatory standards.
Furthermore, emerging economies, which would benefit significantly from an improved cross-border payments system, face additional barriers due to lack of infrastructure and vested interests in existing systems.
More promising alternatives
Nearly half of bankers surveyed see improvements in instant payment systems as a more viable option. These solutions, although less disruptive than CBDCs, could modernize international transactions without the challenges associated with digital currencies.
Final reflection
The future of CBDCs seems uncertain. While projects like mBridge and Agorá try to gain traction, slow progress and regulatory divisions call their viability into question. As optimism wanes, the focus appears to be shifting towards upgrading existing infrastructure as a more practical and achievable solution.
Will it be possible to unify global economies with a system based on CBDCs or will traditional models adapted to new needs prevail?
Do you want to always be updated in the world of cryptocurrencies? Subscribe now to the CriptoTendencia WhatsApp channel! Here you will instantly receive the most relevant information about Bitcoin, Altcoins, DeFi, NFTs, Blockchain and the Metaverse.
Related
Crypto Keynote USA
For the Latest Crypto News, Follow ©KeynoteUSA on Twitter Or Google News.
