IMF says central bank digital currencies can replace cash: ‘This is not the time to turn back’

Central bank digital currencies have the potential to replace cash, but adoption could take time, said Kristalina Georgieva, managing director of the International Monetary Fund on Wednesday.

“CBDCs can replace cash which is costly to distribute in island economies,” she said Wednesday at the Singapore FinTech Festival. “They can offer resilience in more advanced economies. And they can improve financial inclusion where few hold bank accounts.”

CBDCs are the digital form of a country’s fiat currency, which are regulated by the country’s central bank. They are powered by blockchain technology, allowing central banks to channel government payments directly to households.

“CBDCs would offer a safe and low-cost alternative [to cash]. They would also offer a bridge to go between private monies and a yardstick to measure their value, just like cash today which we can withdraw from our banks,” the IMF chief said.

Source: CNBC