The Subtle Art of Slow: The CBDC Adoption Journey

In the era of rapidly evolving monetary systems, central bank digital currencies (CBDCs) have emerged as a new frontier.

Already live in various developing and emerging market economies — namely Nigeria (e-Naira), Jamaica (Jam-Dex), the Eastern Caribbean Central Bank (DCash) and the Bahamas (Sand dollar) — these national digital currencies seek to reshape our economic interactions.

However, reactions to these fledgling systems have been a mixed bag. While central banks hoped for quickly-embracing citizen response, the reality has been a slower uptake than expected.

This slower pace may be viewed as disappointing by some, but is it really as underwhelming as it appears? Or is it, perhaps, simply reflecting another aspect of how transformative technologies often find their footing amidst hesitance and a lack of understanding? Could it be that "slow and steady" isn't a setback but rather a necessary, anticipated part of the CBDC adoption process?

In this article, DEA colleagues, Conrad Kraft and Dr. Jonas Gross will address these questions with lessons from history on payment innovation as well as CBDCs launched in developing and emerging market economies.

Read the full article here.