The majority of finance professionals do not support the launch of central banking digital currencies (CBDCs) according to recently published research.
The CFA Institute canvassed 90,000 of its global membership and found that only 42% were in favour of central banks launching their own digital currency with 34% opposed to the idea and 24% having no opinion.
One possible reason for the lack of support is a lack of knowledge. The same survey found that 40% of respondents have little or no understanding of CBDCs while just 12% professed to having a strong understanding.
According to the CFA, the research suggests that central banks and governments will need to “engage in a significant educational and outreach effort to explain why they would launch CBDCs, for what purpose and under what circumstance”.
The research also asked respondents to name their respective reasons for supporting and opposing the launch of a CBDC. Data privacy and lack of use cases were cited as the main objections by 50% and 40% of respondents respectively. A reduction of currency and settlement risk were cited as the biggest benefit of CBDCs by 58% of respondents.
The nascent CBDC concept has enjoyed differing levels of support from central banks. While the likes of Italy and the UK have launched pilot projects, others like the Central Bank of Canada, have voiced doubts about the ability of CBDCs to fulfil unmet payment needs in a cashless society.