CENTRAL BANK DIGITAL CURRENCY: WHAT FACTORS DETERMINE ITS ADOPTION?
Abstract
This paper attempts to explain the differences in Central Bank Digital Currency (CBDC) adoption across emerging and advanced countries using an ordered probit model. Based on a cross-country dataset, we show that wholesale CBDC is more advanced in countries with developed financial markets and greater cross-border transactions. Retail CBDC is more advanced in countries with lower financial inclusion and a large informal economy. We further show that different factors affect retail CBDC adoption across emerging and advanced countries. However, cross-border transactions are the most crucial factor influencing wholesale CBDC adoption across emerging and advanced countries.
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Buletin Ekonomi Moneter dan Perbankan / Bulletin of Monetary Economics and Banking is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
