CBDCs in 2022: New Trials and Competition with Crypto
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Central bank digital currencies (CBDCs) were one of the biggest stories of 2021 as far as blockchain and cryptocurrencies were concerned, even if CBDCs don’t necessarily have anything to do with either blockchain or decentralized cryptocurrencies. Because for each new all-time high bitcoin (BTC), ethereum (ETH), or any other cryptoasset attained in 2021, it seemed that some central bank would come out with news that it was working on its own CBDC.
However, while the growth of the crypto sector has spurred many central banks into considering or even piloting their own digital currency, 2021 failed to bring any full CBDC launches (although the Bahamas launched the digital Sand Dollar in 2020). And while the expectation might be that 2022 will finally buck this trend and deliver a fully-fledged digital currency, commenters say that we’ll still have to wait another one or two years before witnessing any permanent deployments.
That said, industry figures estimate that 2022 will bring a ramping up of trials and pilots, with more nations and central banks getting involved. At the same time, observers also expect more private banks and financial institutions to push through with their own digital currencies, providing crypto with even more competition.
“It is true that CBDCs have gained a lot of traction over the past years. More than 85% of central banks are moving forward with some initiative, usually in the form of relevant research, early-stage pilot, and in some extraordinary cases development of CBDC solutions and even limited deployment,” said Lambis Dionysopoulos, a researcher at the University of Nicosia’s Institute for the Future.
But while many central banks are dallying with CBDCs in one way or another,
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