Central bank digital currencies (CBDC) could foster a more competitive retail payment sector, but they should be implemented only incrementally due to security concerns, a research paper published by the Bank of Canada finds.
The paper analyses the main advantages central banks may gain by introducing this technology. “Increasing contestability in retail payments seems to be the most credible motivation to issue CBDC,” the analysis says.
However, CBDCs also may create challenges, authors Walte
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