🤔 Do you still remember when central bank digital currencies (CBDCs) were seen as the future star of cross-border payments? But now, the situation seems to have changed dramatically! According to the OMFIF (2024 Future of Payments) survey, instant payment systems (IPS) are gradually becoming the preferred solution for cross-border payments, while the popularity of CBDCs is declining.
📉 The survey shows that only 13% of respondents believe that CBDC networks are the most promising cross-border payment method, a sharp drop from last year's 31%. High costs have become the primary challenge that central banks want to overcome, but there are disagreements in choosing the best solution.
🌐 Speaking of CBDCs, we must mention the currently most advanced multi-currency CBDC platform—the mBridge project. Although it reached the minimal viable product stage in June 2024, it still faces challenges in liquidity and governance. Some respondents stated: 'mBridge provides a new cross-border transmission architecture, faster and cheaper.' However, the platform's dependence on Chinese-developed technology has raised concerns about decentralization.
🚫 Worse, the Bank for International Settlements (BIS) has announced its withdrawal from the mBridge project due to concerns that it could help countries evade international sanctions. BIS General Manager Agustín Carstens clearly stated: 'mBridge is not a bridge for BRICS countries... it was not created to meet the needs of BRICS countries.' However, Josh Lipsky from the Atlantic Council stated: 'As long as mBridge has the potential to help certain countries evade sanctions, the West does not want to be involved.'
💡 In contrast, 47% of surveyed central banks support achieving cross-border payments through connecting instant payment systems. The attractiveness of this solution lies in its scalability and increasing importance in domestic markets, especially in Southeast Asia. However, respondents believe that 'governance and regulatory framework development' are significant obstacles.
📊 The report states: 'The interoperability model of CBDC design will be an important consideration for future global payments.' But evidently, enthusiasm for CBDCs has waned. Only 10% of respondents are actively developing multi-currency CBDCs, and IPS seems to be a more pragmatic choice for central banks.
📈 In the crypto market, Bitcoin has fallen 0.5% in the past 24 hours, trading at $96,458; Ethereum remains flat at $3,704.
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The above content is for information sharing only and does not constitute any investment advice! Investment carries risks, and caution is required when entering the market!
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