What is a CBDC (Central Bank Digital Currency)?. A CBDC is a digital form of a nation’s currency issued by its central bank. Designs vary from retail wallets to interbank settlement tokens.
How it works
Central banks manage issuance and policy. Systems can run on permissioned ledgers with controlled participants.
Why it matters
CBDCs could modernize payments but raise privacy and design debates.
Common pitfalls
- Confusing CBDCs with crypto—governance and trust differ
- Overlooking offline and resilience requirements
- Assuming programmable money always benefits users
Quick example
A pilot lets citizens pay taxes using a central bank wallet with instant settlement.
See also
- Stablecoin
- ISO 20022
- Payments
TL;DR: What is a CBDC (Central Bank Digital Currency)? defined in plain English with practical next steps.
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