Colombia analyzes the creation of its own CBDC

Joe Biden, the president of the United States, recently opened the doors to the creation of a digital dollar in the United States, a country that has decided to stand up to the lack of regulation of this type of digital currencies, and that is now exploring different options after the US dollar may lag behind against the current market trend.

For their part, in Russia, businessmen resort to using bitcoin to rescue their assets in the face of the harsh sanctions to which their country is exposed after the invasion of Ukraine. This movement has caused, among others, difficulties when carrying out bank transfers; and the impediment of not being able to negotiate with dollars or euros.

Currently the panorama leads to the world of central bank digital currencies. In fact, there are more than eighty countries around the planet that are developing or considering the creation of their own CBDC; and Colombia, although until now it had not commented on the matter, values ​​the creation of its own digital currency.

At the moment, CBDCs are not a priority for the Banco de la República in Colombia, nor will their creation be sought quickly. However, its manager, Leonardo Villar wanted to highlight that, although the creation of a Colombian CBDC is not estimated in the short term; Yes, the functioning of these currencies when they are launched by central banks has been studied for years. In this way, he revealed that the Colombian bank is working on a future implementation of a CBDC. It would therefore follow in the footsteps of so many nations in the world that are working on the same path.

Lagging behind in Latin America

From the Bitcoin Colombia Foundation, Carlos Mesa, its leader, has stated that Colombia is lagging behind in this sense with respect to other countries in Latin America like Argentina, Venezuela or El Salvador. Mesa believes that Colombia is far behind and there needs to be greater clarity regarding CBDCs and cryptocurrencies.

Likewise, he recalled that the Superfinanciera’s cryptocurrency pilot, which is the country’s only official approach to these currencies, in which the banks themselves are located, means that there is something of the traditional financial model in the pilot test.

The test bed that the regulatory body has enabled to work and evaluate cryptocurrencies raises some doubts. In any case, it must be taken into account that virtual currencies are a reality currently; and this means that different companies and financial entities are studying them in depth.

In fact, currently nine out of ten central banks in the world are actively exploring CBDCs in some way; and many countries are developing and even testing the implementation of their own central bank digital currencies in the coming years. It is likely that, by 2025, the main countries in the world will have their own CBDC, a different way of understanding money that opens up new possibilities for users.

However, there are doubts on the part of many people regarding the possibility of CBDCs replacing physical money. However, in reality it is unlikely that this situation will occur, since it is a custom that is deeply rooted in societies; and therefore it is not expected that physical currencies will disappear in favor of virtual ones.