What does CBDC stand for?

Ukrainian President Volodymyr Zelensky signed into a law a bill called On Payment Services that allows the country's central bank to issue a central bank digital currency (CBDC), an announcement on the president's official website said. The bill regulates how payment services, especially digital ones, can be provided in Ukraine.

Will Ukraine launch a CBDC?

On June 30, the bill was passed in Ukraine's national parliament, the Verkhovna Rada. The National Bank of Ukraine (NBU) has been looking into potentially launching a CBDC since 2018. It built an early prototype on the Stellar blockchain and published a report on the subject in 2019.

Are CBDCs a good idea?

For one thing, CBDCs have yet to gain wide acceptance. While BIS expects as many as 24 central bank digital currencies to be circulating by decade’s end, more than two-thirds of central banks say they’re unlikely, in the near term, to issue a digital currency people can use for everyday purchases.

What are the different types of CBDCs?

There are two types of CBDCs, wholesale and retail. Financial institutions are the primary users of wholesale CBDCs, whereas consumers and businesses use retail CBDCs. Wholesale CBDCs are similar to holding reserves in a central bank. The central bank grants an institution an account to deposit funds or use to settle interbank transfers.