CBDC concerns
Executive summary
Central banks worldwide are advancing CBDC work but many remain cautious: 31% of central banks reported delaying timelines and 68% cite data privacy as a top concern [1] [2]. Policymakers list key risks — privacy and surveillance, financial‑stability and bank‑run mechanics, technical resilience/cybersecurity, and weak retail adoption — and are testing design limits like holding caps and offline use to mitigate them [2] [1] [3] [4].
1. Privacy and surveillance: the political lightning rod
Privacy emerges as the dominant political and social objection to CBDCs. Multiple trackers and reports show privacy or data‑use concerns at the top of central‑bank checklists — 68% of central banks name data privacy as a primary implementation worry [2]. Commentators and industry pieces stress that surveillance fears fuel public backlash and political interventions: in the U.S. a recent executive action halted retail CBDC work, explicitly framing CBDC as a surveillance risk [5] [6]. These sources show privacy is not just technical but existential for citizens and politicians alike [2] [5].
2. Financial stability: deposits, bank runs and macro transmission
Central banks and academics warn that retail CBDCs can reshape bank funding and lending, potentially raising run risk and changing monetary transmission. The IMF synthesizes six transmission channels through which CBDC affects stability — including bank funding and run risk — and proposes analytical tools to measure them [7]. Academic modeling likewise finds nontrivial macro effects — welfare gains depend on rates and design — underscoring that CBDC is a macroeconomic, not merely a payments, policy [8]. Practically, commercial banks often push for holding limits because large CBDC balances could displace deposits and strain bank intermediation [3].
3. Adoption uncertainty: what if nobody uses it?
Planners worry that even after launch a retail CBDC might not attract users if it offers limited new functionality over existing payments. Reuters reports the “elephant in the room” is privacy and the parallel risk that very few people will adopt a launched CBDC, since it may not materially change what consumers can already do [1]. Opinion and trade pieces note a persistent split: wholesale CBDCs show clear cost and settlement efficiencies and have stronger uptake in pilots, while retail projects face adoption bottlenecks [9] [10].
4. Design tradeoffs: limits, offline use, and interoperability
Decision makers are focused on concrete design levers: holding limits, offline usability, cost to users, and privacy-preserving architectures. OMFIF’s outlook emphasizes disagreement across ecosystem participants about holding limits — commercial banks want low caps; consumer advocates want higher limits for usefulness [3]. Other commentators underscore that interoperability and privacy frameworks will determine whether CBDCs scale and whether they complement or crowd out private digital money [11] [12].
5. Cybersecurity and technical resilience: a nonnegotiable
CBDC courses and central‑bank materials highlight cybersecurity and technical infrastructure as core competencies for launch. The IMF’s training modules explicitly list cybersecurity risks alongside macro‑financial implications for policymakers preparing CBDC projects [4]. Industry reports echo concerns that technical failure, hacks, or poor offline solutions would quickly undermine trust and adoption [2] [13].
6. Geopolitics and market effects: competition with stablecoins and crypto
Wider reporting frames CBDCs as both a response to and a competitor with private digital money. Some argue CBDCs can be an on‑ramp to digital assets for ordinary users; others warn they could stifle private payments innovation and alter crypto’s competitive landscape [14] [10]. Research firms and commentaries also point to broader market risks — from speculative crypto cycles to regulatory shifts — that interact with CBDC rollout choices [13] [14].
7. How policymakers are responding: cautious pilots and toolkits
Faced with these tradeoffs, many central banks are moving in stages: scaled pilots, regulatory sandboxes, and analytic toolkits to measure financial‑stability channels [1] [7]. International bodies (IMF) are offering training and handbooks to equip officials on cybersecurity, monetary transmission, and privacy design choices [4]. The mix of pilots, modelling and public engagement reflects a pragmatic effort to resolve the most consequential tradeoffs before full rollouts [1] [4].
Limitations: available sources do not mention detailed country‑by‑country user‑level survey data on attitudes toward CBDC beyond high‑level adoption stats, so granular public sentiment in specific economies is not covered here (not found in current reporting).