For the past several years, as cryptocurrencies have become more popular, central banks have started exploring the idea of issuing their own digital currencies. Governments are warming to this idea because it would allow them to set and control the digital currency market and, most importantly, regulate the cryptocurrencies people use.
These plans are finally starting to come to fruition in some parts of the world: China this week announced it is “almost ready” to launch its own sovereign digital currency. According to CNBC, “China’s central bank would launch its digital token through a two-tier system, under which both the People’s Bank of China and commercial banks are legitimate issuers.” Sweden’s central bank is another actively exploring issuing its own digital currency.
Our take? Over the next 12 months, several more central banks around the world will do the same.