Agora

Bank

United

<ul> 
 <li>All original BRICS member states are trialing CBDCs to create an alternative payment system to the US dollar.</li> 
 <li>G7 nations, including the United States, are advancing their CBDC projects aimed at international payments, despite public disinterest.</li> 
</ul> 
In 2024, a significant trend has emerged among global governments: the accelerated development of Central Bank Digital Currencies (CBDCs) specifically designed for wholesale use. This development comes amid a general public disinterest in retail digital currency projects, coupled with growing geopolitical tensions that either seek to strengthen or undermine the dominance of the <a href="https://www.ethnews.com/us-dollars-decline-predicted-by-peter-brandt-could-bitcoin-be-the-alternative/">US dollar</a>. 
As of September 17, 2024, data from the Atlantic Council’s CBDC tracker indicates that 98% of the world’s economy is exploring or has already implemented digital versions of their national currencies. This exploration is particularly focused on the utility of these digital currencies in international banking and trade settlements rather than in everyday consumer transactions. 
<h2 id="cbdcs-and-international-trade-dynamics">CBDCs and International Trade Dynamics</h2> 
The push towards CBDCs has been largely motivated by the need to facilitate smoother and more efficient international payments. For instance, the mBridge project connects banks across China, Thailand, the UAE, Hong Kong, and Saudi Arabia, with potential expansions on the horizon. Such projects underscore a strategic pivot away from traditional retail-focused digital currencies towards mechanisms that enhance the capabilities of international financial exchanges and interbank settlements. 
This shift is evident within both the <a href="https://www.ethnews.com/could-the-brics-currency-really-topple-the-dollar/">BRICS</a> and G20 nations. Every original BRICS member state—Brazil, Russia, India, China, and South Africa—is actively testing a CBDC, reflecting concerted efforts initiated last year to develop a payment system independent of the US dollar. Similarly, within the G20, all member countries are exploring CBDCs, with 19 already in advanced stages of exploration and 13 actively engaged in pilot projects, including Brazil, Japan, India, Australia, Russia, and Turkey. 
Notably, the United States is also deeply involved in these developments, participating in the Agora project alongside six other central banks. This project, now moving into the design phase, highlights a reduced likelihood of the US launching a retail digital currency. Instead, the focus is shifting towards a globally integrated CBDC that could operate across borders. 
The strategic orientation of CBDC initiatives has been influenced by geopolitical events such as Russia’s invasion of Ukraine and the ensuing G7 sanctions, which have led to more than a doubling of cross-border <a href="https://www.ethnews.com/global-central-banks-ramp-up-cbdc-exploration/">CBDC</a> projects, reaching a record 44 ongoing pilot programs. These include significant endeavors like the digital euro and the digital yuan, which remain priorities despite public apathy and limited interest from banks and financial institutions. 
The post <a href="https://www.ethnews.com/global-shift-g20-and-brics-turn-to-cbdcs-for-international-trade/">Global Shift: G20 and BRICS Turn to CBDCs for International Trade</a> appeared first on <a href="https://www.ethnews.com">ETHNews</a>.

Global Shift: G20 and BRICS Turn to CBDCs for International Trade

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