The Central Bank of Colombia recommends developing a retail CBDC with restrictions on transactions and asset storage. According to the authorities, this approach can provide the necessary level of privacy and security.
The Central Bank of Colombia studied the macroeconomic implications of issuing a retail digital currency in the country, concluding that the CBDC should be developed subject to certain restrictions.
The main conclusion of the study was that the potential introduction of a retail CBDC doesn’t pose significant macroeconomic risks. However, the Central Bank analysts recommend setting restrictions on storing and using digital currency in order to mitigate possible threats.
According to the regulator, such a CBDC design will:
- protect users from cyberattacks targeting their balances or transactions;
- balance privacy and transparency of transactions by offering a variety of levels of restrictions;
- reduce demand for retail CBDCs as a store of value, potentially threatening the popularity of bank deposits.
The Central Bank of Colombia keeps exploring the possibility of introducing CBDCs, but it remains uncertain about the need to introduce a digital currency in the country. The region is more optimistic about blockchain technologies, the implementation of which the local authorities support in every possible way.
