As interest in central bank digital currencies (CBDCs) reaches unparalleled heights, the International Monetary Fund (IMF) is witnessing a surge in demand for guidance on the subject. To address this, the IMF plans to release a CBDC handbook, according to deputy managing director Bo Li’s recent speech.
Meeting the urgent needs of central banks exploring CBDCs
Recognizing the urgency to support central banks considering the implementation of CBDCs, the IMF has engaged with nearly 30 countries that have requested assistance in the past two years. With over 40 countries seeking guidance, Li emphasizes the importance of CBDC capacity development to prevent a digital divide.
Poorly designed CBDCs could lead to a range of risks, prompting the IMF to create a CBDC handbook that will serve as the foundation for capacity development. The upcoming handbook is discussed in more detail in an IMF staff report, which highlights that it will primarily be descriptive rather than prescriptive, offering information, experiences, empirical findings, and evaluation frameworks for CBDCs.
Set to be completed over a span of four to five years, the CBDC handbook will be primarily funded by Japan. The report provides a tentative table of contents for the handbook, featuring 19 chapters divided into broad sections that address both policy and technical issues.
As policymakers tackle more tangible questions related to CBDCs, the IMF’s advice must be more tailored to individual country circumstances and more normative, anchored in policy experience and frameworks. However, the IMF will prioritize assistance for systemically important countries and those fast-tracking CBDC developments but facing high-capacity constraints or weak regulatory standards.
