What is CBDC?

CBDC refers to a digital form of national currency issued and regulated by a country's central bank

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It combines the benefits of digital technology with the stability and trust associated with traditional fiat currencies

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Central banks are exploring CBDCs to enhance financial inclusion, improve payment systems, and address the rise of private digital currencies

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CBDCs aim to provide secure, accessible, and efficient digital payment options for individuals and businesses

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CBDC operates on a distributed ledger technology (DLT) or blockchain, allowing transactions to be securely recorded and verified

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Unlike cryptocurrencies, CBDCs are centralized and typically have a value pegged to the national currency

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There are two main types of CBDCs. Retail CBDC is accessible to the general public and can be used for everyday transactions

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Wholesale CBDC is restricted to financial institutions for interbank settlements, aiming to improve efficiency in the financial system

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