Central bank digital currency (CBDC) generates broad public- and private-sector attention these days. However, attempts to digitize fiat money to transfer value or to pay for goods and services are not new. US computer scientist David Chaum set out to create an electronic currency that maintained anonymity when he founded DigiCash1 in 1989. The DigiCash concept and its intent were similar to today’s public, decentralized ledger-based Bitcoin. However, DigiCash operated for less than a decade, as Chaum unsuccessfully tried to convince banks to adopt its technology.

What distinguishes CBDC today is momentum. Digital currency ecosystems have benefited from the mass adoption of digitalization during and after COVID-19. And as its infrastructure and technology mature, governments, individuals, and private companies are working together to innovate and develop CBDC policies.