Central Bank Digital Currency: What is This and Why is It Important?

Abstract

This paper explores the topic of central bank digital currency, which refers to cryptocurrency issued by the central bank. It could provide more efficiency, bigger share in payments market and respond to the tendency of using fewer physical cash. The key impacts and risks are identified as well as preconditions for successful implementation of CBDC. Overall, CBDC attracts interest among many central banks and researchers but also it could be more significant for retail users.