Central Bank Digital Currencies: Challenges and Prospects
We expect central bank digital currencies (CBDC) to gain further momentum. This will likely be driven first and foremost by China, which is advancing quickly with its digital yuan pilot projects, writes Dirk Willer, Global Head of Emerging Markets Strategy at Citi. However, the digital yuan can only be a competitive tool for China if authorities are willing to grant more anonymity than they may be inclined to offer. Furthermore, the rise of the digital yuan is likely to increase regulatory risk for all crypto currencies.