15 May 2022 09:32, UTC
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Central Bank of Chile Governor Rosanna Costa said the bank should thoroughly test CBDC before integrating it into the country’s financial ecosystem.
Chile’s central bank has withdrawn its plans to release CBDC by the end of 2022, saying it will conduct a thorough study and additional analysis of the product before proceeding with its launch.
Chile’s central bank has published a report looking at the risks and benefits of issuing a digital version of the national currency. Apparently, the bank is optimistic about this financial product, believing that it can strengthen the economic system and protect consumers:
“CBDC will promote a competitive, innovative and integrated payment system that is inclusive, sustainable and protects people’s information.”
The bank also argues that the Chilean peso could be a suitable alternative to cryptocurrencies such as Bitcoin, which “could be used in criminal transactions.”
“CBDC is also a good alternative to address the proliferation of so-called virtual currencies, which, although they still play a very minor role in the payment system, could change the functioning of the financial market and the transmission of monetary policy if their use becomes widespread.”
Rosanna Costa said CBDC must operate both online and offline before it can be integrated into the country’s financial network, so it will not be deployed in late 2022 as previously planned. She added that Chilean regulators must develop a system to track CBDC transactions.
Once the bank has resolved all the issues, it will decide whether and when to launch CBDC. The bank promised to issue a report on the matter by the end of the year.
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