Asia's Interest in Wholesale CBDC-and Challenges to Cross-border Use - 0 views
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John Kiff on 09 Feb 23In the years ahead, new financial market infrastructures based upon digitized central bank liabilities called wholesale CBDCs may emerge in Asia. Given the dollar's preeminent role in intra-Asia trade and finance, how these new systems are linked to each other-and to dollar payments channels-will depend in part on the role that U.S. institutions play. The launch of new, technologically sophisticated national-level large-value payment systems across emerging market economies in Asia could ultimately help advance U.S. interests in the region-including by increasing the efficiency and reducing the costs of converting dollars into local currencies. The extent to which this will happen depends in part on whether Washington creates a policy environment that helps facilitate U.S. institutions and technologies in playing a more significant role in the build-out of more efficient, lower-cost cross-border channels for wholesale financial transactions in Asia.