Digital Cash From a Central Bank

Central bank digital money is a digital form of the currency a central bank issues, a claim on the central bank itself rather than on a commercial bank or a private company. Cash already works this way for the public, while most of the money people use online is a bank's promise recorded in an account. Designs fall into two families. A retail version would be open to households and businesses, perhaps through an app or a card. A wholesale version would be limited to banks and other approved institutions that settle payments between themselves. Many projects are research, pilots or design studies, so a country's current status matters more than a general claim that digital money is arriving.

The design choices are where the debate sits. Privacy is one: a system could record every payment, mask small ones, or leave the data with intermediaries. Another is how it fits with bank accounts, since money moving from deposits into central bank balances could change how banks fund themselves, so some designs set limits on holdings. A third is access, including for people without phones or reliable connections, and for visitors from abroad. Offline use, legal status as a means of payment, and who runs the wallets people actually see are further points. A central bank's own design paper shows which of these choices it has made and which remain open for consultation.