Today I will be sharing some very interesting news about CBDC

Even though I love reading/learnign/writing about leo, hive, NFTs etc - there are some important news to be shared concerning the Central Banks' Digital Currency.

If it is the first time you hear it, trust me - you will be hearing a lot more about it in the (very near future)

### What is CBDC?

> The phrase "central bank digital currency" (CBDC) has been used to refer to various proposals involving digital currency issued by a central bank. A report by the Bank for International Settlements states that, although the term "central bank digital currency" is not well-defined, "it is envisioned by most to be a new form of central bank money [...] that is different from balances in traditional reserve or settlement accounts.

> Central bank digital currencies also called digital fiat currencies or digital base money.

> The present concept of CBDCs was directly inspired by Bitcoin, but CBDC is different from virtual currency and cryptocurrency, which are not issued by the state and lack the legal tender status declared by the government. Proposed implementations will likely not use any sort of distributed ledger such as a blockchain.

> CBDCs are presently in the **hypothetical stage**, with some proof-of-concept programmes, although a survey in early 2020 found that more than 80% of central banks were studying the subject.

https://en.wikipedia.org/wiki/Central_bank_digital_currency

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As I understand more and more countries are researching and trying to find ways to take advantage of the digital currency's properties. 

So let's go see what's going on in the world and some of the most recent news about CBDC.


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##### Central Banks are gradually warming to digital currencies and are searching for use cases.

![image.png](https://images.hive.blog/DQmZwPpqureEYFqS2HRNsxkEL8hH4K1CXAnoE8U16ZfDHWc/image.png)

> Last April, amid the COVID-induced panic that engulfed the planet, more shocking news came from China. The People’s Bank of China (PBOC) announced that it would start testing its own central bank digital currency (CBDC), a first for a major economy. **Government employees in four cities were paid in digital yuan, while four commercial banks began internal tests.** By December, around 50,000 lucky citizens had received 200 e-yuan (£23) in their digital wallets to spend on apps such as the food delivery service Meituan Dianping. A new era had started.

https://www.worldfinance.com/banking/central-banks-are-gradually-warming-to-digital-currencies

##### The Central Bank of India is investigating into CBDC, but takes under consideration the potential risks and dangers 

> According to the RBI, an interest-bearing CBDC would improve an economy’s ability to respond to changes in the policy interest rate and enhance monetary policy transmission.

> In emerging markets with large-scale capital inflows, a CBDC can act as an instrument of “sterilization,” alleviating the constraint posed by a finite stock of government securities on the central bank balance sheet, it said.

> The RBI, however, cautioned that a CBDC could lead to banking sector disintermediation.

https://www.coindesk.com/indias-central-bank-sees-pros-and-cons-with-national-digital-currency

##### China is moving with fast paces into implementing the digital yuan, which already is circulating in cities like Beijin, Shangai etc. At the same time, USA is starting now to research the possibility of an American Digital Currency

> Annabelle Huang recently won a government lottery to try China’s latest economics experiment: a national digital currency.

![image.png](https://images.hive.blog/DQmNtUKTJrjY1F6cB8FEKCpB1Ht5EKTadhCzaX9S1eL6evb/image.png)

> After joining the lottery through the social media app WeChat, Ms. Huang, 28, a business strategist in Shenzhen, received a digital envelope with 200 electronic Chinese yuan, or eCNY, worth around $30. To spend it, she went to a convenience store near her office and picked out some nuts and yogurt. Then she pulled up a QR code for the digital currency from inside her bank app, which the store scanned for payment.

> “The journey of how you pay, it’s very similar” to that of other Chinese payments apps, Ms. Huang said of the eCNY experience, though she added that it wasn’t quite as smooth.

https://www.nytimes.com/2021/03/01/technology/china-national-digital-currency.html

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##### The Turkish Minister of Finance has announced that they investigate the ways to regulate digital currencies

> Turkey is preparing to end its “wait and see” policy towards digital currency regulation, with the news that the country’s finance ministry is working with regulators to devise a more substantial policy response.

> The Turkish Ministry of Treasury and Finance tweeted that it was beginning work with a number of regulatory bodies in the country to assess the risks posed by cryptocurrency, and to **devise a government solution.** 

https://coingeek.com/turkish-treasury-exploring-digital-currency-with-regulators/


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The way I see it, there are many things going on back stage and we will be witnessing many innovations in 2021.

I hope that you found this post useful and insightful

Thank you for visiting!

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