Central bank digital currency or CBDC started in Finland in 1993 like some sort of electronic form of cash. The idea and the system was dropped in 2000.

Today around 120 countries around the world are in a stage to launch national digital currency.  There are many reason why government do this for the benefit of the country. The most important tool for the government is easy control of money, cheap money, fast transaction, stopping money laundering and black market, illegal worker payments etc.

The news we hear about CBDC open up many question and dilemma. Many question won’t be answered and for many we already know the answer.

Trying to find enough about CBDC have made us invest more time to give the right answer to the common question.

The scariest known information is that we won’t have cash, restriction on cash, digital ID and wallet.

Here are few question and some short answers to them.

How CBDC work?

Central bank digital currency are cashless accounts as the name says they are digital.

Banks or in this case Government hold your digital wallet (example your bank account now). Your bank account or digital wallet will be accessible by your phone or your digital ID card (example credit card).

All your money will be stored in your digital wallet and you won’t need more cash to buy and pay anything.

CBDC is stored in digital wallet, and the digital wallet is stored in government (your bank).

Are they going to control consumer with CBDC?

CBDC has Expiration data. That means you can’t save money on your regular account.

CBDC Is issued by the central bank (government) directly and they can view the consumer activity (transaction).

They are Programmable currency that can be turned on and off if needed by the state.

Who owns CBDC?

CBDC will be owned by the government.

We have seen many forms of crypto currency like Bitcoin, Ethereum, BNB etc. And many of those crypto currencies are used by the people and investors but they all rely on US Dollar.

CBDC work like Bitcoin for example but under the supervision of your government.

Are CBDC going to replace paper money?

The answer is YES. In many cases we already use digital payment with our credit cards. Paying our goods and services with our credit card is one step closer to CBDC.

Cashless payments are coming slowly into our monetary system but there is still an open question, will people adopt that idea and use it?

Types of CBDC?

We have three types of CBDC:

  • Retail
  • Wholesale
  • Hybrid

Retail – used by individual and business

Wholesale –  for bank settlements

Hybrid – is a combination of multiple