PwC: More Than 80% of Central Banks Are Considering Launching a CBDC

Central bank digital currencies will greatly benefit cross-border transactions and economies, the firm says

article-image

Source: Shutterstock

share

key takeaways

  • Central banks are going to continue to investigate CBDCs, PwC analysts say
  • Stablecoins offer many of the same benefits as CBDCs but without the surveillance that comes with a government-issued currency

The vast majority of central banks are considering launching a central bank digital currency (CBDC), according to analysts at accounting firm PwC.

“CBDCs will facilitate more effective, lower cost and 24/7/365 cross-border payments for the financial services industry,” analysts from PwC said in the firm’s annual index of CBDCs and stablecoins, which was released Monday. “We expect that CBDCs will greatly benefit cross-border transactions and economies of all relevant jurisdictions.”

Overall, retail CBDC projects, which are digital currencies designed for public use, have reached greater maturity levels than wholesale projects, which are digital currencies used by financial institutions that have accounts with central banks, the report notes. There has been an increase in wholesale pilots in recent years though, analysts said.

China became the first major economy to pilot a retail CBDC in 2020 with the digital yuan. The pilot is running in 12 cities as of March 2022. 

The Sand Dollar, issued by the Central Bank of the Bahamas as legal tender in October 2020, was the first retail project of its kind. Nigeria’s central bank launched the first CBDC in Africa, the eNaira, shortly afterwards. 

On the wholesale side, PwC ranked the combined effort from the Hong Kong Monetary Authority and the Bank of Thailand to launch mBridge as the top product. The central banks are working to develop a proof-of-concept prototype to enable real-time, cross-border foreign exchange payments on distributed ledger technology.

Other top projects include efforts by Canada, Singapore, France and South Africa.

“Wholesale CBDCs have the potential to streamline security token post-trade operations through atomic delivery-versus-payment and increase the market efficiency for several asset classes,” Benoit Sureau, PwC France and Maghreb financial services risk and blockchain partner, said.

PwC analysts for the first time included a stablecoin overview in the annual CBDC index report, noting that privately issued tokens will continue to evolve and exist alongside CBDCs. 

Stablecoins reached a market capitalization of around $190 billion in early 2022 and will continue to grow as the tokens offer many of the same benefits as a CBDC without the surveillance that comes with a government-issued currency, the report noted. 

Transparency around reserve assets, particularly for stablecoins that are backed with fiat currency, will be a major concern going forward, though, as the asset class continues to grow and regulation ramps up, analysts added.

“The role of the stablecoin in the crypto markets has and will continue to evolve as adoption of crypto increases, forcing a more prominent role of stablecoins across the larger financial ecosystem,” Matt Blumenfeld, director and digital asset specialist at PwC said. “Regulation will only strengthen the importance and give credence to the role that stablecoins will play.”


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates (6).png

Research

In recent months, a number of highly accretive developments were implemented across the protocol to improve fee capture, expand product functionality, and ultimately drive value accrual to the RUNE token, with more upgrades on the immediate horizon. These developments include hiking the minimum swap fee parameter to increase revenue, adding a Burn System Income Lever to reduce the RUNE supply, the addition of COSM-WASM smart contracting and IBC to enable an application layer, new chain integrations, and more.

article-image

Delta comes out of stealth with $11 million in funding, and some novel ideas

article-image

HBO documentary Money Electric presents a fun theory that sadly falls flat

article-image

Has Satoshi Nakamoto been here the whole time, working on Bitcoin Core?

article-image

The same tokens were also named as securities in the SEC’s lawsuits against Coinbase and Binance

article-image

Kaito AI said Monday that memecoin mindshare is now at a yearly high

article-image

Plus, Celestia looks about to flip Ethereum data availability usage