There has been a significant increase in experiments and pilots involving wholesale central bank digital currencies (CBDCs) over the past year, according to the Bank for International Settlements (BIS).
In recent years, nearly all central banks have begun exploring CBDCs, with 94% of the 86 central banks surveyed by BIS in late 2023 indicating their engagement in this area. The focus is shifting from theoretical research on the potential implications of CBDCs to practical experiments aimed at testing the feasibility and desirability of specific design features. More than half of the surveyed central banks are developing proofs of concept, while one in three is conducting a pilot program.
While much of the discussion has centered on retail CBDCs, there is now a noticeable shift towards wholesale CBDCs, with increased experiments being reported. BIS suggests that the likelihood of central banks issuing a CBDC within the next six years is currently higher for wholesale than for retail CBDCs.
Regarding design features, many aspects of CBDCs remain undecided. However, interoperability and programmability are frequently considered for wholesale CBDCs. In contrast, over half of the central banks exploring retail CBDCs are looking into holding limits, interoperability, offline options, and zero remuneration.
On the topic of cryptocurrency, the survey reveals that stablecoins are rarely used for payments outside the crypto ecosystem. Additionally, about two-thirds of jurisdictions that participated in the survey have established or are working on regulatory frameworks for stablecoins and other cryptoassets.