October 14, 2021

G7 For ‘Green Light’ Establishment of Central Bank Digital Currency (CBDC) But Conditional!

 A line-up of finance ministries from the G7 developing economies held talks on the central bank's digital currency (CBDC) yesterday in Washington, United States (US).

Those covering 7 major countries; Canada, France, Germany, Italy, Japan, the United Kingdom (UK), and the US have agreed on 13 general policy principles on the implementation of the CBDC.

The following are some of the policy details put forward by the G7:

The CBDC needs to support and not pose a threat to the bank’s ability to meet its mandate against the monetary.

The CBDC should not pose a threat to financial stability.

CBDCs need to meet the strict standards outlined.

CBDC accordingly complements the cash

CBDC should also be able to appear as a safe liquid and solution asset.

CBDC is able to be the backbone of the payment system.

The issuance of CBDC should not violate the mandate of the central bank.

CBDC production should meet strict standards for aspects of privacy, transparency, and bear the protection of consumer information.

Any CBDC should be based on a commitment to long-term transparency, legal requirements, and good economic governance.

The CBDC assumes responsibility for mitigating risks to the international financial and monetary system.

For now, China is leading the CBDC launch race - the digital yuan.

China’s restrictions on the country’s crypto industry show their efforts to promote and control central bank monetary flows.