Prospects and Risks of Using the Central Bank Digital Currency. Consequences for the Monetary System

DOI: 10.33917/es-3.201.2025.92-97

The article explores digital money characteristics of both central bank and private sector in both advanced and emerging market economies. Newly emerging forms of the private sector electronic money (digital coins, or so-called cryptoassets), such as Bitcoin, have drawn much attention because the underlying distributed ledger technology used therein enables decentralized verification while maintaining cash-like functions.

Meanwhile, some central banks have explored potential application of the distributed ledger technology and issuing their own digital coins for general public or financial institutions – so-called the central bank digital currency initiatives. Over the past 12 months, central bank digital currencies (CBDCs) have transformed from a distant concept into the core of the global economic policy agenda. Debates on CBDC have progressed towards adopting CBDC and its implications for the financial system. Such innovations evidently have serious consequences for the monetary system at both national and global levels.

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