Florie Mazzorana-Kremer
A Central Bank Digital Currency (CBDC) is a digital currency issued by a central bank that brings together the characteristics of cryptocurrencies and traditional fiat money. To date, only a few countries have initiated the issuance of this innovative and hybrid medium of exchange (Cambodia, Bahamas, Singapore, China, Uruguay, Caribbean), most of them still at the experimental stage. However, many other central banks are on the way of doing it, such as the Federal Reserve (FED) and the European Central Bank (ECB). Unlike cryptocurrencies, CBDCs are stable units of value, fully backed by central banks. However, like their private crypto counterparts, they enable real-time transactions at no cost. Because they create a direct link between central banks and consumers, they offer new levers for monetary policies. They also facilitate the tracing of transactions and payers, which is likely to generate new business practices. At the same time, they provide governments with a formidable tool for controlling people's money, with the ability to directly withdraw or block funds based on social or discriminatory criteria.