Known as the Digital Currency Electronic Payment (DC/EP), the CBDC (Central Bank Digital Currency) project piloted by the People’s Bank of China is so far the most advanced projet of its kind in the world. The introduction of a CBDC in the world’s most populous country and second largest economy may have far reaching consequences.
Central banks have been stepping up efforts to create new electronic currencies in an attempt to counter the threat posed to their monetary power by private currencies such as Facebook’s Libra. However, CBDCs might prove to be too little too late to shape the future of money. When you can’t fight a trend, it’s better to embrace it.