The release of Bitcoin in 2008 triggered the emergence of digital currencies to disrupt and challenge the efficacy of traditional financial systems. Digital fiat currency (DFC) has the ability to deliver peer-to-peer payments that are faster, cheaper, more secure, more convenient and more efficient than traditional legacy-based banking systems.
DFCs are by default, supported by a centralised authority. This enables DFCs to overcome challenges typically associated with private digital currencies offers, such as high price volatility and lack of universal acceptance.
If implemented correctly, DFCs could contribute to improved national payment systems, convenience and broad digitisation. If hastily applied, there are risks of consumer exposure to cyber-attack, financial instability and potential national payment system failure if proper infrastructure and regulatory frameworks are not implemented.
This new concept note in partnership with FSD Africa, seeks to understand the benefits and potential risks of digital fiat currencies for financial-sector development and inclusion.
This note will be discussed at the International Telecommunication Union (ITU) Focus Group on Digital Currency including Digital Fiat Currency in New York, USA.
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
|cookielawinfo-checbox-analytics||11 months||This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".|
|cookielawinfo-checbox-functional||11 months||The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".|
|cookielawinfo-checbox-others||11 months||This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.|
|cookielawinfo-checkbox-necessary||11 months||This cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".|
|cookielawinfo-checkbox-performance||11 months||This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".|
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.