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7 - Central Bank Digital Currency

Rationales, Design Considerations, and Implementation Using the Algorand Blockchain Technology

from Part III - The Power of Distributed Ledgers in Payments

Published online by Cambridge University Press:  26 October 2023

By
Andrea Civelli ,
Co-Pierre Georg ,
Pietro Grassano  and
Naveed Ihsanullah
Edited by
Sabrina Leo  and
Ida Claudia Panetta
Sabrina Leo
Affiliation:
Sapienza Università di Roma
Ida Claudia Panetta
Affiliation:
Sapienza Università di Roma
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Summary

In this chapter, we talk about three main topics. We first define the issues that a central bank digital currency (CBDC) could address and the reasons to enhance our understanding of CBDCs. Second, we discuss the optimal design principles of a CBDC as they arose from various conversations with central banks, national and supranational authorities, market participants, and academics in various jurisdictions. Finally, we propose a well-rounded and robust solution for a retail CBDC based on Algorand technology which meets these design principles. Most of the content of this chapter is borrowed from the White Paper Issuing Central Bank Digital Currency Using Algorand by Civelli, Georg, Grassano, and Ihsanullah (2022). In that paper, we extensively cover the CBDC design and issuance topics, informed by our recent participation in various pilots, studies, and round-table conversations on these topics.

Keywords

Central Bank Digital CurrenciesDesign PrinciplesBlockchainAlgorandDigital Currencies
Type
Chapter
Information
The Role of Distributed Ledger Technology in Banking
From Theory to Practice
 , pp. 155 - 171
Publisher: Cambridge University Press
Print publication year: 2023

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References

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