LONDON, July 10 — The story of central bank digital currencies is no longer a theoretical debate among economists in hushed conference rooms. It is, as of this year, a global movement that encompasses 130 countries and nearly all of the world’s economic output. According to the Atlantic Council’s CBDC Tracker, those nations represent 98% of global GDP, and the list includes 19 G20 countries.
For those involved—central bankers, finance ministers, and the billions of people who may one day use these digital dollars, euros, or yen—what unfolded was a quiet revolution that began years ago and is now accelerating with remarkable speed. The Bahamas was first.
In October 2020, the island nation launched the Sand Dollar, becoming the pioneer in a field that, at the time, felt experimental. Nigeria followed exactly one year later, in October 2021, with the eNaira. These early adopters provided real-world laboratories for the technology, testing how digital cash might function in economies with different needs—from the dispersed island communities of the Caribbean to the vast, cash-heavy markets of West Africa.
The lessons from those launches have rippled outward, informing the cautious but deliberate work now underway in the world’s largest economies. At its heart, the push toward CBDCs is about control and modernization.
Central banks see a future where physical cash, long the bedrock of monetary systems, is in steady decline. A digital currency issued by the state, rather than by private banks or tech companies, offers a way to preserve the public’s access to safe, central-bank-backed money in an increasingly digital world. It also promises faster, cheaper payments and greater financial inclusion for the unbanked.
But the stakes are enormous: design choices around privacy, programmability, and the role of commercial banks could reshape the financial system for decades. The European Central Bank is deep in the investigation phase for a digital euro. No final decision on issuance has been made; that call is expected by 2028.
The process has been methodical, involving extensive public consultation and technical experimentation. For Europeans, the digital euro raises questions about data privacy and the extent to which the central bank could track transactions—a sensitive issue in a region with strong data-protection laws.
The ECB has signaled that it aims to design a system that balances innovation with the fundamental right to privacy, but the details remain under negotiation. Japan, too, is moving forward. The Bank of Japan is conducting pilot tests for a digital yen, exploring both the technical infrastructure and the potential economic implications.
For a society that has long relied on cash, the shift represents a significant cultural change. The pilots are designed to test resilience, scalability, and user acceptance before any commitment to a full rollout.
The United States presents a more complicated picture. The Federal Reserve has released discussion papers and is conducting research, but it has not committed to issuing a digital dollar. The political landscape around the idea remains fractured, with some lawmakers warning of government overreach and others arguing that the U.S. risks falling behind if it does not act.
The Fed’s cautious approach reflects deep divisions over the design and purpose of a CBDC, including whether it would be account-based or token-based, and whether it would coexist with or compete against private stablecoins. For now, the world’s largest economy remains a spectator, watching as others build the infrastructure of the future. The International Monetary Fund has emerged as a key player in this story.
The IMF has been actively advising member countries on CBDC design and policy, releasing a comprehensive ‘CBDC Handbook’ in 2023. The handbook distills lessons from early adopters and provides a framework for countries at every stage of exploration.
For developing nations, the IMF’s guidance is often the difference between a well-designed pilot and a costly misstep. The Fund’s involvement underscores the global nature of the shift: no country is developing a CBDC in isolation. What to watch next: the European Central Bank’s decision in 2028 will likely set the tone for other advanced economies.
If the digital euro proceeds, it could accelerate efforts in the UK, Canada, and elsewhere. In the meantime, the pilots in Japan and the ongoing research at the Federal Reserve will continue to produce data and debate.
For the 130 countries now exploring CBDCs, the question is no longer whether digital currencies will arrive, but what shape they will take—and who will control them.
