Why it's time to take central banks' digital currencies seriously
by Mohit Joshi and Dixit Joshi; Source: World Economic Forum
The introduction of central bank digital currencies could upend the global economic order.
This technology could bring multiple benefits, such as more efficient trade, greater financial access for millions of people, and a reduction in crime.
But there are still technological barriers to overcome, too.
The decline of cash use in western economies has accelerated due to COVID-19. Meanwhile, central bank digital currencies are emerging, potentially upending the existing global economic hierarchy.
Lockdowns limit physical interactions and naturally reduce physical cash use. But there also credible concerns that paper money can transmit the virus. Research has shown that the average European banknote plays host to around 26,000 colonies of bacteria. The human influenza virus can survive on a banknote for up to 17 days; with one-dollar and five-dollar bills changing hands more than 100 times per year on average, the risk during a global pandemic is considerable.
Who then can blame the People’s Bank of China (PBOC) when it announced in February that it would be destroying cash collected in high-risk environments, such as public transport, markets or in hospitals?
Read full article on World Economic Forum.