The head of the International Monetary Fund (IMF) said efforts were underway to create a synchronized globally interoperable platform for advancing central bank digital currency (CBDC) efforts.
Speaking at a conference in Rabat, Morocco, Kristalina Georgieva said efforts must be made to coordinate regulation on global settlements as digital payments become popular.
European Union (EU) Leading Western Governments’ CBDC Progress
According to Georgieva, 10 out of 14 countries have already expressed practical interest in CBDCs. She added that coordinated regulation must avoid settlement blocks that will fragment the global economy.
Learn how to send money across borders using crypto.
The EU is leading Western governments’ efforts to introduce a CBDC. Its executive arm will soon release new rules limiting the use of a potential digital euro.
The EU wants the European Central Bank to limit the digital euro’s role as a store of value to ensure financial stability.
Demonstrators protested against digital euro efforts in Amsterdam in mid-May. Fears of government surveillance and a conspiracy to end cash-dominated proceedings as governments struggle to build a strong argument around the need for a digital currency.
The European Central Bank is expected to announce an implementation phase and a pilot later this year. The ECB’s Christine Lagarde expects the bank to make a final ruling on the digital euro in 2026 or 2027.
UK Central Bank Tests Retail and Wholesale CBDC Settlements
The Bank of England jointly studied a CBDC’s practical application and benefits in a recent trial dubbed Project Rosalind.
It found that a CBDC system could settle transactions between individuals and businesses quicker and help firms to develop new financial products.
Companies can pay vendors through a locked multi-party payment system which releases funds when vendors deliver goods or services.
The central bank also recently proved its real-time gross settlement concept that synchronized asset transfers between two ledgers.
The system will likely come into force next year, allowing quicker interbank settlement times. The technology will likely allow a wholesale CBDC settlement system.
The Bank of England dismissed surveillance fears, arguing that its CBDC would have adequate privacy controls.
The US Federal Reserve will launch its FedNow interbank settlement trial next month.
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Source: https://beincrypto.com/imf-fears-eu-leading-cbdc-push/