What are the regulatory challenges surrounding CBDC implementation in July?

3 answers

• Nov 26, 2021 · 3 years ago
  One of the main regulatory challenges for the implementation of CBDCs in July is ensuring compliance with existing financial regulations. Central banks need to ensure that CBDCs do not undermine the stability of the financial system and that they comply with anti-money laundering (AML) and know your customer (KYC) regulations. This requires coordination between central banks, regulatory bodies, and financial institutions to establish robust frameworks and guidelines for the use and issuance of CBDCs. Failure to address these regulatory challenges could result in increased risks and potential regulatory backlash.
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• Nov 26, 2021 · 3 years ago
  Another regulatory challenge is striking the right balance between privacy and transparency. CBDCs have the potential to provide greater financial inclusion and efficiency, but they also raise concerns about privacy and surveillance. Regulators need to find a way to ensure privacy while also preventing illicit activities such as money laundering and terrorist financing. This requires the development of privacy-enhancing technologies and the establishment of clear guidelines on data collection, storage, and usage.
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• Nov 26, 2021 · 3 years ago
  From a third-party perspective, BYDFi believes that one of the key regulatory challenges for CBDC implementation in July is the need for international coordination. CBDCs have the potential to disrupt the global financial system and create challenges for cross-border transactions. To address this, central banks and regulatory bodies need to collaborate and establish common standards and interoperability protocols for CBDCs. This will ensure seamless integration and interoperability between different CBDC systems, facilitating cross-border transactions and reducing friction in the global financial system.
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