Central Bank Digital Currency (CBDC)
Versão digital da moeda de um país, emitida diretamente pelo banco central, com o mesmo valor da moeda tradicional e respaldo do Estado que a emite.
Key points
- CBDC, short for central bank digital currency, is a digital version of a country's official currency, issued by the monetary authority itself.
- Unlike a private stablecoin, a CBDC is a direct liability of the central bank, with the same backing as traditional currency.
- Several countries are studying or piloting CBDCs, with different designs depending on the goal, from retail use to use between institutions.
What is a CBDC?
A CBDC is the digital form of a country's money issued directly by the central bank. While money in a bank account is, in practice, an obligation of the private bank, and a stablecoin is an obligation of its issuer, a CBDC is an obligation of the central bank itself. In other words, it is public money in digital form, with the same value and backing as the official currency.
How it works
Designs vary. A retail CBDC would be used directly by people and businesses in everyday life, as a digital version of cash. A wholesale CBDC would be restricted to financial institutions, to settle transactions between them. Some proposals use distributed ledger technology, similar to blockchains, while others adopt more traditional architectures.
Unlike open cryptocurrencies, a CBDC is centralized by definition: the central bank controls issuance and the rules. This allows it to be integrated with public policy and the existing payment system, but it also raises questions about privacy and the role of banks, since citizens would gain access to a form of money issued directly by the state.
In Brazil, the Central Bank is developing a digital currency initiative aimed mainly at use between institutions and at asset tokenization, within its own project.
Why it matters
A CBDC can change payment infrastructure and the way public money circulates. For businesses, understanding the difference between a CBDC, a private stablecoin, and bank money helps assess the risks and opportunities of each instrument in digital and cross-border operations.
Risks and limitations
CBDCs raise privacy concerns, since a centralized system can give the issuer visibility into transactions. There is also the risk of impact on banks, should citizens migrate deposits to central bank money. In addition, the projects are complex and at varying stages, with many design decisions still open. As a result, the pace of adoption varies widely between countries.