By Marc Jones
A groundbreaking report has revealed that 134 countries, representing 98% of the global economy, are currently exploring digital versions of their currencies. This trend is gaining momentum, with pioneers like China, the Bahamas, and Nigeria already experiencing increased adoption.
The research, conducted by the U.S.-based Atlantic Council think-tank, indicates that all G20 nations are investigating central bank digital currencies (CBDCs), with 44 countries actively piloting them. This marks a significant increase from just 36 countries a year ago.
The push towards CBDCs is a response to the declining use of cash and the growing influence of alternative forms of currency, such as bitcoin and 'Big Tech'. Countries like the Bahamas, Jamaica, and Nigeria have already launched their CBDCs, while China's e-CNY pilot has seen a quadruple increase in transactions.
Experts predict that China's central bank will be close to a full CBDC launch within the next year. Other major developments include the European Central Bank's digital euro pilot and the United States' participation in a cross-border CBDC project.
Despite these advancements, the U.S. lags behind in the CBDC race, citing concerns about privacy and other issues. The country's stance on CBDCs remains a contentious topic, particularly in the current presidential election campaign.
Additionally, the geopolitical landscape has influenced the rise of 'wholesale' CBDC projects, with initiatives like the mBridge connecting multiple countries' digital currencies. Russia and Iran are also making strides in developing their own digital currencies.
Overall, the global shift towards CBDCs is reshaping the financial landscape and could have significant implications for individuals and businesses worldwide. Stay informed and be prepared for the future of digital currencies.