The use of a digital currency as fiat is gaining momentum as more countries join the race to launch a CBDC. According to a tracker unveiled by the Atlantic Council’s Geoeconomics Center, 46 countries are now exploring a CBDC. This is more than a hundred per cent increase compared to the numbers in May.
The Geoeconomics Center described itself as “a nonpartisan organization that galvanizes U.S. leadership and engagement in the world, in partnership with allies and partners, to shape solutions to global challenges,” its website states.
The original version of the CBDC tracker, which launched in April last year, has been used by the U.S. Federal Reserve and the Bank of International Settlements (BIS), the centre claims.
Eighty-one countries (representing over 90 per cent of global GDP) are now exploring a CBDC. In our original report published in May 2020, only 35 countries were considering a CBDC.
According to the tracker, the United States is lagging in developing a state-backed digital currency compared to large Central banks like the European Central Bank, the Bank of Japan, and the Bank of England.
In February, Federal Reserve Chairman Jerome Powell said that the digital dollar was a “very high priority” for the Fed. However, he emphasized the need to “get it right” instead of rushing to launch a digital dollar, mainly to compete with China’s digital yuan. Nonetheless, the chairman recently said, “you wouldn’t need stablecoins, you wouldn’t need cryptocurrencies if you had a digital U.S. currency. I think that’s one of the stronger arguments in its favour.”
Meanwhile, “5 countries have now fully launched a digital currency,” the Geoeconomics Center added. They are the Bahamas, Saint Kitts and Nevis, Antigua and Barbuda, Saint Lucia, and Grenada.
The centre further detailed that “14 other countries, including major economies like Sweden and South Korea, are now in the pilot stage with their CBDCs and preparing a possible full launch.”