Learnings From Discontinued Central Bank Digital Currencies (CBDC)

Abstract

The financial and monetary system is transitioning into contactless payment options and digital currencies. About 90 percent of the world's central banks are engaged in CBDC research, proof of concept, pilot, development, and launch, while the remaining are overlooking CBDC offerings. Notwithstanding, many central banks have cancelled their CBDC following their launch. While learning from the past failure is extoled as a virtue, learning from failed CBDC is seldom in the CBDC ecosystem, contrary to dominant literature on CBDC development and scalability. This study explores reasons why central banks discontinued already launched CBDC's. The authors adopted criterion sampling to select failed CBDC. This multiple case content analysis shows that low levels of trust, cybersecurity concerns, inadequate digital identification infrastructure, and obsolete and uncompetitive technology are the leading triggers of failed CBDC. Through the lens of actor-network theory (ANT), actors contributing to CBDC failure was identified