Central banks less likely to issue retail CBDCs in mid-term, BIS says

According to the results of the 2023 BIS survey on central bank digital currencies and cryptocurrencies, only 12% of central banks plan to issue retail CBDCs in the medium term.

A recent survey by the Bank for International Settlements (BIS) indicates that the vast majority of central banks around the world are moving away from issuing retail versions of central bank digital currencies (CBDCs) in the medium term, with only 12% of respondents planning to do so. do so.

BIS survey respondents | Source: BIS

BIS says that based on survey results, the likelihood of a wholesale CBDC being introduced within the next six years is now “higher than retail,” adding that by the end of this decade “there could be as many as nine wholesale CBDCs publicly circulating.” .”

The international financial institution says central banks are still interested in wholesale CBDCs due to their desire to “increase cross-border payments” in both advanced economies and emerging markets and developing economies.

“Specifically, some participants noted that a wholesale CBDC could solve the challenges cross-border payments face today, such as high costs, slow speed, limited access, and insufficient transparency.”

Bank for International Settlements

The survey also found that when it comes to wholesale CBDCs, central banks are mainly trying to allow financial institutions to “access new functions enabled by tokenization, such as composability and programmability.”

Meanwhile, for retail CBDCs, which are still being explored by more than half of the central banks surveyed, financial regulators are more interested in clarifying issues related to “holding limits, interoperability, offline options and zero fees,” the document notes.