CBDCs’ Payments Expected to Hit $213 Bln by 2030

The Central Bank Digital Currencies (CBDC)’s total value of payments is expected to grow 260,000% in the coming decade to record $213 billion annually by 2030, compared to $100 million in 2023, a new study revealed. 

According to Juniper Research, the radical change will occur because of the increasing world governments’ adaption of the CBDCs to bolster financial inclusion and tighten control over how digital payments are made. 

CBDC is a digital coin issued by a central bank and pegged to the country’s fiat currency. It is not a cryptocurrency, whose value is determined by market supply and demand.

The research found that domestic payments would account for more than 90% of the total value transacted via CBDCs. Because they are issued by central banks, CBDCs will be targeted by domestic payments. The report suggested that the cross-border payments will happen later following stronger links and ties among entities in terms of CBDCs in the individual country. 

In this regard, Nick Maynard, the report author, said: “While cross-border payments currently have high costs and slow transaction speeds, this area is not the focus of CBDC development. As CBDC adoption will be very country-specific, it will be incumbent on cross-border payment networks to link schemes together; allowing the wider payments industry to benefit from CBDCs.”

According to Atlantic Council, only 11 countries have launched their own CBDC to date. Nigeria is the largest country with an active central bank digital currency. The rest of them are small island states in the Caribbean region. While 114 countries, representing over 95% of global GDP, are currently exploring a CBDC, compared to 35 countries in May 2020. A total number of 60 countries are in an advanced exploration stage (development, pilot, or launch).

In 2023, more than 20 countries will take remarkable steps towards piloting a CBDC. Australia, Thailand, Brazil, India, South Korea and Russia plan to continue or begin pilot testing in 2023.