Fernando Esteban Morera Martinez
The idea of governments issuing so-called “central bank digital currencies” (CBDC), either as a substitute or complement of other forms of money, is not entirely new. It has been discussed for over a decade by academics and activists. Some argue that this concept is even older, going back to the 1980s, when James Tobin, an American economist, suggested that Federal Reserve Banks in the United States could make available to the public a widely accessible ‘medium with the convenience of deposits and the safety of currency.’ More recent developments, however, have caused CBDC to become a priority for several countries around the world. Specifically, the progressive decline in the use of
cash in certain economies, coupled with the proliferation of other digital currencies (e.g., cryptocurrencies and stablecoins), and the need to create more resilient monetary and fiscal systems, have propelled governments and international organizations, in consultation with other actors, to actively study the merits of issuing CBDC. All things considered, the issuance of CBDC deserves careful evaluation by policy makers, as it can result in a wide range of implications, including legal and macroeconomic ones. This paper aims to analyze the CBDC phenomenon from an interdisciplinary perspective, covering select legal, design, technology, policy, and behavioral aspects of relevance for the Transatlantic Marketplace. To do so, this paper focuses on CBDC initiatives in the United States, the European Union, and the United Kingdom, while highlighting lessons learned from other important CBDC projects around the world, when relevant.