The International Monetary Fund (IMF) is working on a central bank digital currency (CBDC) platform. This should allow for transactions between countries in the future, as IMF director Kristalina Georgiewa explained on Monday.
Systems are needed that unite countries. “We need interoperability,” Georgieva said at a conference in Rabat, Morocco, adding, “That’s why we at the IMF are working on the concept of a global CBDC platform.”
The IMF wants central banks to agree on a common regulatory framework for digital currencies that will enable global interoperability. Georgieva warned that failing to agree on a common platform would create a vacuum that would likely be filled by cryptocurrencies. A CBDC is a digital currency controlled by the central bank, while cryptocurrencies are largely decentralized.
CBDCs could also help make remittances cheaper, the IMF chief said. She pointed out that the average cost of remittances is 6.3 percent and amounts to $44 billion per year.
Digital euro in three to four years at the earliest
According to the European Central Bank, a digital euro could be introduced in three or four years. The condition is that the Governing Council, the member states and the European Parliament give the project the green light, ECB Executive Board member Fabio Panetta recently emphasized.
The ECB is in regular contact with the European Commission. The Brussels government is expected to present its proposals for a digital euro on June 28. This initiative aims to define and regulate “central aspects”.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
