Central bank digital currencies (CBDCs) are critical for financial system innovation, according to Agustín Carstens, head of the Bank for International Settlements (BIS), and the private sector will be crucial in bringing them to market. During a speech at a CBDC conference in Basel, Switzerland, Carstens said these things. In his opinion, the foundation of the financial system of the future will be CBDCs, whether they are sold in wholesale or retail forms. As per the group’s advice, central banks across the globe are investigating the issuance of digital renditions of their national currencies.
Carstens did stress that the private sector will play a larger role in CBDC issuance than monetary authorities. According to him, the private sector will continue to handle most customer-facing services, and the maintenance of cyber resilience inside these institutions will be essential to preserving public confidence in the system. Managing current and new cyber threats requires cooperation between the public and commercial sectors. Additionally, Carstens emphasized the security risks associated with running CBDC systems and the significance of not disregarding other design goals, such as preserving a suitable amount of privacy, particularly in retail CBDCs. He recently urged nations to enact the necessary laws to enable the issue of CBDCs.