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Central Bank Digital Currencies: IMF Pushes for Global Platform for Interoperable Payments

• The International Monetary Fund (IMF) is pushing for a global platform for central bank digital currencies (CBDCs) to enable transactions between countries.
• Kristalina Georgieva, the IMF’s director, says that without a framework, the vacuum of global payments would end up being filled by decentralized cryptocurrencies.
• A survey suggests that the majority of Americans are opposed to the adoption of a CBDC if it gives the government control over how people spend their money.

International Monetary Fund Pushes for Global Platform To Connect Countries with Central Bank Digital Currencies

The International Monetary Fund (IMF) is working on a worldwide platform for central bank digital currencies (CDBCs) to enable transactions between countries. IMF’s director Kristalina Georgieva argues that if CBDCs are approached on a country-by-country basis, the need for global interoperable payments systems would be neglected and the capacity of CBDCs would be underutilized.

Cryptocurrencies Could Fill Vacuum Of Global Payments Without Framework

Georgieva says that cryptocurrencies are an investment opportunity when backed by assets, but when they are not they are a “speculative investment”. Without a framework, she warns that the vacuum of global payments would end up being filled by decentralized cryptocurrencies.

CBDCs Would Promote ‘Financial Inclusion’ and Make Remittances Cheaper

The IMF executive says CBDCs would promote “financial inclusion” and make remittances cheaper than ever before. She also believes these systems could help governments keep track of financial activity on their respective countries in order to prevent illicit activities from taking place.

Survey Suggests Majority Of Americans Opposed To Giving Government Control Over Spending

A recent survey from the Cato Institute in collaboration with YouGov suggests that the overwhelming majority of Americans were opposed to the issuance of a CBDC if it gave the government control over how people spend their money. About 68% said they were against the adoption of a CDBC if it meant that the government could keep an eye on their spending, and 68% say they will not support a CBDC if it eliminated all cash.

Final Thoughts

The IMF’s push for global platform to connect countries with central bank digital currencies shows promise in helping promote financial inclusion and making remittances easier while also providing governments with more insight into financial activities happening within their respective countries. However, this comes at cost as surveys suggest most Americans are opposed to such implementations due to fears around giving too much power to governments over how people spend their money