Central Bank of Russia Reviews Potential Benefits and Drawbacks of CBDCs
Helen Partz's original article for cointelegraph.com reduced by 49%
The central bank of Russia has reviewed the potential benefits and drawbacks of central bank digital currencies in a policy brief published on April 18. In the document, entitled "Is there a future for central bank digital currencies," the Central Bank of the Russian Federation outlined a number of potential benefits of CBDCs, such as their capability to reduce transaction costs in the economy, as well as provide an asset that is less risky and more liquid. The Bank of Russia noted that CBDCs' potential to minimize transaction costs can be only realized in case a technical solution for CBDCs will offer a better tool in terms of ease of use in payments and savings, as compared with fiat money and debit cards.
While acknowledging the sufficient advantages of CBDCs, the central bank pinpointed CBDCs' lack of anonymity as the only one potential disadvantage. The Bank of Russia also stated that CBDCs are able to compete with commercial bank deposits in a context of low inflation and moderate interest rates. Previously, the Bank for International Settlements published research that found that 70% of central banks worldwide were researching into issuance of CBDCs.
On April 1, the deputy governor of the State Bank of Pakistan, the nation's central bank, announced that the institution aims to issue a digital currency by 2025.
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