Globally, 134 countries are advancing towards implementing their own digital currencies, digital versions of their current national currencies. Collectively, these nations represent 98% of the global economy. This emerging financial instrument is known as Central Bank Digital Currencies (CBDCs).
According to Reuters, half of these countries have made significant progress in rolling out their digital currencies, with China, the Bahamas, and Nigeria leading the way. A recent report from the Atlantic Council reveals that all G-20 countries are currently exploring the adoption of CBDCs.
At present, 44 countries have launched experimental digital currencies, an increase from 36 just a year ago. This surge in interest is driven by a desire to reduce reliance on physical cash and counter the threats posed by cryptocurrencies like Bitcoin.
China is conducting the most extensive experiments with digital currency, with transactions of its digital yuan, or e-CNY, increasing fourfold. Meanwhile, the European Central Bank has also introduced a pilot digital currency, and the U.S. is engaged in a cross-border CBDC project with six other major central banks, though it remains comparatively slow in its adoption.
The U.S. Congress recently passed a bill banning the direct retail issuance of CBDCs, reflecting ongoing debates about privacy and other concerns. Meanwhile, countries like Russia and Iran are advancing their own digital currency projects, with Russia’s digital ruble already in use in Moscow’s metro and some gas stations, and Iran working on its digital rial.