In a recent survey, it has been revealed that nearly a third of central banks have postponed the launch of digital versions of their currencies. However, due to the desire to safeguard their currency issuance authority, most central banks still plan to move forward with Central Bank Digital Currencies (CBDCs).
The discussion around CBDCs gained renewed attention after U.S. President Donald Trump initiated work on a digital dollar soon after returning to power last month.
The survey results, released on Tuesday, were conducted before this announcement. Central banks participating were questioned on their current stance regarding CBDCs in light of the challenges associated with digital assets. The survey disclosed that 67% had maintained their position from the previous year, with three-quarters intending to introduce a CBDC and 19% not planning to do so.
Subsequent findings presented a more varied picture. The percentage of central banks favoring CBDC issuance saw a slight decline, with 15% now less inclined to proceed compared to none in 2022.
The Official Monetary and Financial Institutions Forum (OMFIF) and Giesecke+Devrient, a German banknote company, conducted the survey. They highlighted that hesitancy surrounds the topic, as few central banks have committed to issuing a CBDC despite extensive exploratory efforts.
Thirty-one percent of the surveyed central banks have delayed their CBDC launch schedules, with nearly half of those aiming for implementation within three to five years postponing their plans.
Advocates of digital currencies argue that they could facilitate real-time, cross-currency transactions and serve as a viable alternative to physical cash, which is perceived to be on the decline.
Critics, however, assert that existing systems can achieve similar advancements. Concerns have also been raised, particularly related to allegations—denied by central bankers—that governments could exploit digital currencies for surveillance purposes.
Notably, the survey highlighted that central banks are motivated by the objective of upholding monetary sovereignty when considering introducing a CBDC, particularly in major economies like the eurozone.
Wolfram Seidemann, the CEO of Giesecke+Devrient Currency Technology, pointed out that a digital euro has been proposed to counterbalance President Trump's push for 'stablecoins', a type of cryptocurrency generally pegged to the dollar.
Issued by privately-owned entities for profit, stablecoins—should they dominate the market—potentially pose a threat to countries’ seigniorage revenue earned from currency issuance, as well as the influence derived from it.
Seidemann noted the prevailing reservations around privacy concerns and highlighted a potential risk: the lack of significant user adoption of launched CBDCs due to the perceived limited advancement in their capabilities.
The survey also underscored that emerging market central banks—such as those in Jamaica, the Bahamas, Nigeria, and China—expressed substantial apprehension about user adoption, signaling this as a primary concern for approximately 55% of the respondents.