#2: Critical Policy Issues & Lessons Learned from UK and China

CBDC Broadcast

9 Feb

15th February 2022

With:

| Keith Bear (University of Cambridge)

| Jean-Michel Godeffroy, (JMG Consulting)

In this session, Keith Bear (University of Cambridge) and Jean-Michel Godeffroy (JMG Consulting) join FNA to explore the critical policy dilemmas and lessons learned from the UK and China. As the world watches China’s massive e-CNY rollout and the UK’s meticulous research phase, our guests break down the functional divide between wholesale and retail CBDCs.

The conversation centers on the "Architecture of Trust"—analyzing why most central banks are gravitating toward a two-tier model to avoid disrupting the commercial banking sector. We also tackle the technical pragmatism of the era: is blockchain a mandatory requirement for a digital currency, or can centralized ledgers offer the same benefits with fewer complications?

Key Discussion Points:

Wholesale vs. Retail: Distinguishing between the high-value interbank systems and the public-facing "digital cash" intended for daily use.
The "Two-Tier" Standard: Why a hybrid distribution model is essential for maintaining financial stability and leveraging private-sector innovation.
Blockchain Necessity: A critical debate on whether distributed ledger technology (DLT) is the best foundation or if centralized databases remain more efficient.
The Anonymity Paradox: Lessons from China’s "managed anonymity" and how the UK is balancing user privacy with AML/KYC regulations.
Attracting the User: Moving beyond "sovereignty" to identify the real-world features that will drive citizens to adopt a CBDC over existing private payments.

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