The Impacts of Central Bank Digital Currency on Economy

Abstract

The objectives of this study were to 1) study the development of Central Bank Digital Currency (CBDC) in different countries. 2) study the impact of Central Bank Digital Currency. It employed qualitative research to study the situation of CBDC in terms of concepts, developments and current situations in different countries. This has been compiled from various sources that are organized by agencies/individuals both within and outside the country, such as the Bank of Thailand, the International Monetary Fund, related articles, and information from the Internet, etc.

The results of this study showed that 1) central banks in many countries such as the United States, Canada, Sweden, China, and Japan are increasingly interested in research and development of CBDCs, including Thailand. However, most countries are still in the research phase on this issue. There are only some countries that have started using it, such as China, Bahamas, Nigeria, Jamaica and Caribbean islands. 2) CBDC is affected differently in various sectors. People benefit from convenience, safety and speed, with lower transaction costs. The business sector can manage their business money more efficiently. And can be further developed into new financial innovations. At the same time, commercial banks benefit from better liquidity and reduce fees for cross-border money transfers. But they may face challenge in investing to support digital transactions and the declining role of financial intermediaries. The central bank benefits from lowering the burden and cost of printing banknotes. He can better control the amount of money in the system, however, a CBDC may impair the efficiency of monetary policy.