Most Countries Exploring CBDCs, says Atlantic Council

As many as 134 countries and currency unions, representing 98% of global GDP, are exploring a Central Bank Digital Currency (CBDC), according to a new report from Atlantic Council, an American think tank in the field of international affairs, said.

The report said that the number was only 35 in May 2020 and currently, 66 countries are in the advanced phase of exploration—development, pilot, or launch. Almost half of the countries are at advanced stages.

A CBDC is virtual money backed and issued by a central bank and as money and payments have become more digital, the world’s central banks have realised that they need to provide a public option—or let the future of money pass them by.

Every G20 country is exploring a CBDC, with 19 of them in the advanced stages of CBDC exploration. Of those, 13 countries are already in the pilot stage. This includes Brazil, Japan, India, Australia, Russia, and Turkiye.

The report said that three countries have fully launched a CBDC—the Bahamas, Jamaica and Nigeria. In Nigeria and the Bahamas, CBDC issuance has increased substantially. All three countries are focused on expanding the reach of their retail CBDCs domestically.

“There is a new high of 44 ongoing CBDC pilots, including the digital euro. European countries—both in the euro area and beyond—are increasingly testing wholesale CBDCs, both domestically and across borders,” the report said.

BRICS Piloting CBDCs

All original BRICS member states—Brazil, Russia, India, China, and South Africa—are piloting a CBDC and since last year, BRICS has actively promoted developing an alternate payments system to the dollar. Some 39 countries are at research stage including Argentina, Chile, Pakistan, and Zimbabwe, the report said.

In every country with an advanced retail CBDC project, CBDCs are intermediated, meaning they are distributed through banks, financial institutions, and payments service providers.

The US is now participating in a cross-border wholesale CBDC project – Project Agorá – with 6 other major central banks. In May, the US House passed a bill prohibiting the direct issuance of a retail CBDC, but the Senate has not acted. CBDC continues to be an issue in the ongoing US presidential campaign.

Since Russia’s invasion of Ukraine and the G7 sanctions response, cross-border wholesale CBDC projects have more than doubled. There are currently 13 of them—including Project mBridge—which connects banks in China, Thailand, the UAE, Hong Kong, and Saudi Arabia. mBridge is expected to expand to other countries this year, as per Atlantic Council’s projections. Iran is also reportedly working on a digital trial.

“Digital yuan (e-CNY) is still the largest CBDC pilot in the world. In June 2024, total transaction volume reached $986 billion in 17 provincial regions across sectors such as education, healthcare, and tourism. This figure is nearly four times the 1.8 trillion yuan ($253 billion) recorded by the People’s Bank of China in June 2023,” the report said.