A new study by blockchain company Ripple reveals that major players in the financial sector believe that central bank digital currencies (CBDC) they will eventually replace fiat currencies over time. Rippl public this study with the title «Report of new value» on Friday.
The report states that more than 70% of the surveyed audience spanning five world regions agree that CBDCs can bring about critical social change. Many agree that CBDCs can deliver a range of benefits such as access to credit and financial inclusion by 2027. Based on responses from 1,600 people who participated in the survey, CBDCs are the most popular in the Asia Pacific region .
In this region, China’s major bank is the most likely to launch its CBDC first. Recently, ad an expansion of its CBDC pilot to other cities. Of those surveyed, 85% of central bank executives believe that their countries will launch their national digital currency by 2026.
Outside of financial inclusion, 44% of these executives believe that CBDC technology would offer better national competitiveness. 43% trust that CBDC technology will improve the efficiency of their payment systems. 42% of these executives believe that technology would improve global innovation.
Obstacles to CBDC deployment
The report emphasizes the enormous benefits of having CBDC. However, most central banks are still struggling with various barriers to launching their national digital currencies. Such barriers include security and privacy protections, identity verification, and offline access.
The report adds that many expect the transformation of CBDCs to be timely. They also hope to start enjoying the benefits of the switch from fiat to CBDC in less than ten years. However, they must realize that there is a lot of work to be done before any central bank launches a proper CBDC.
Furthermore, the report of Rippl admits that most major banks have some challenges implementing their CBDCs. Therefore, he suggests that all central banks should hold a conference and brainstorm possible solutions to these challenges. The report also emphasizes that the discussion must also include interoperability between all CBDCs.
As previously reported, the Treasury Department of The United States suggested better collaboration between nations so they can discuss a framework for regulating CBDCs around the world.. The survey results align with other findings indicating growing interest in CBDCs.
Most cryptocurrency regulations from authorities also include CBDC regulation. As the general crypto market downturn continues, some regions are suggesting that this downturn is the best period to implement CBDCs. They argue that CBDCs can be presented as digital assets that offer customer protection in contrast to private digital assets, which do not provide such benefits.