The results of a survey conducted by the Central Bank of Ukraine show that the majority of its participants expect the creation of a CBDC for non-fiat retail payments.
The Central Bank of Ukraine published the results of a survey applied to different participants in the financial and economic sector of the country, where the majority asked to explore the development of a central bank digital currency (CBDC) retail, which allows retail payments without fiat money. This option will be very useful in e-commerce.
In the published document, the bank explains that it presented several proposals to analyze what are the most promising use cases expected for the CBDC. Survey participants gave a score of 4,3/5 to cashless retail payments.
Source: Central Bank of Ukraine
By conducting this survey, the Central Bank of Ukraine wanted to gain a deeper understanding of the general views of financial market participants on the design and use of the e-hryvnia, and therefore presented various options for developing the CBDC. Potential areas of use for the CBDC to choose from were: a CBDC for targeted social assistance payments, for settlements of securities and other financial instruments, for corporate payments of legal entities, for cross-border payments, or a CBDC as an interest-bearing financial instrument.
The most popular options, in addition to non-fiat retail payments, were cross-border payments and settlements in securities and other financial instruments. The least popular option among survey participants was the use of the e-hryvnia as an interest-bearing financial instrument.
At the beginning of the year, Ukraine announced its alliance with the Stellar Foundation to begin the development of a CBDC, after years of studying the technology. blockchainEarlier this month, the country's Central Bank announced the approval of the Payment Services Act, which allows it to legally recognize the development of its CBDC and make its launch official.
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CBDC, e-commerce and cryptocurrencies
Most experts who participated in the survey of the Central Bank of Ukraine note that the issuance of a blockchain-based CBDC will facilitate electronic transactions, which can be carried out much faster, safer and cheaper compared to other existing methods. In fact, according to the results, 69% of respondents believe that the e-hryvnia will replace other electronic payment and transaction methods present in the country. Moreover, more than 50% agree that the CBDC will reduce the need to use fiat money.
Financial experts who participated in the bank's survey also noted that the country's CBDC must be able to be implemented in the markets cryptocurrencies, and digital assets, which are booming and growing.
Ukraine is a leader in cryptocurrency adoption
Ukraine considers cryptocurrencies to be the evolution of finance, and will therefore play a leading role in the financial system of the future. The country, according to the Global Cryptocurrency Adoption Index Chainalysis’ 2020 ranking leads the way in crypto adoption globally. Ukraine received Chainalysis’ top score of 1/1 as the leading nation in cryptocurrency adoption worldwide, followed by Russia and Venezuela.
Recently, the Central Bank of the United Arab Emirates also officially announced the development of a CBDC. According to the insights According to a local media outlet, the central bank will launch its digital currency between 2023-2026, to enter the Top 10 of the world's major banking regulators and boost its digital transformation.
Christine Lagarde, President of the European Central Bank (ECB), reported that nearly 80 central banks around the world have already jumped on the CBDC bandwagon and are working on their development.
Continue reading: French and Swiss banks are experimenting, together with the BIP, with CBDCs for cross-border settlements
