The World Economic Forum (WEF) 2023, which was held in Davos, Switzerland, saw the South African Reserve Bank (SARB) governor Lesetja Kganyago addressing the challenges.
Governor Lesetja Kgnayago tackled the issues surrounding the adoption of Central Bank Digital Currencies (CBDCs) during a panel discussion entitled "In the Face of Fragility: Central Bank Digital Currencies."
Kganyago raised concerns about whether or not CBDCs were a solution in search of a problem, questioning if there was a genuine issue that needed to be addressed by this new technology.
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He also highlighted that countries researching and looking to introduce CBDCs had cited various reasons for its implementation. This included modernizing the central bank, making national payment systems more efficient, addressing domestic market failure, and ensuring strong financial inclusion.
However, Kganyago also emphasized the importance of understanding the demand for CBDCs before introducing them to the public. He stated that before making it available to the general public, central banks should first determine if the general public is interested in using it.
In light of these arguments, Kganyago said that the SARB is approaching the issue of CBDCs with extreme caution, stating:
We are going to be excellent pupils when it comes to retail CBDCs, <...> I would rather be a follower than a first mover.
The WEF 2023 panel discussion emphasized the need for a careful and thoughtful approach to the implementation of CBDCs, as well as the importance of understanding the potential issues and demand for this new technology.
In other news, Poland becomes the seventh European country to allow Binance to operate in its country.
