Is digital currency the future of money?

Bitcoin has been at its peak in popularity since its creation, with its price increasing and crypto expanding day by day. Various countries or many people are constantly joining and investing in it. And for this reason, the central banks of different countries are trying to create their own currency. Many people think that digital media can be the money of the future. So they have generated a lot of discussion and criticism. Again we also know that many countries have banned digital currencies. CBDCs are currencies controlled by central banks of various countries.

CBDC is a form of digital currency. It is a digital currency that is controlled by a country's central bank. They are online based just like cryptocurrencies. Countries whose central banks have issued such currencies are known as CBDCs, but their value is determined by the central banks of different countries. The widespread adoption of Central Bank Digital Currency (CBDC) represents a significant evolution of monetary systems.

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A CBDC offers a range of online-based transactions to citizens of the country by the country's central bank. But another important thing here is that it needs to show more excitement. However, before central banks create digital currencies, their limitations and benefits must be identified. However, before creating such online based currencies, you must know their advantages and disadvantages and implement them. Because digital has advantages as well as disadvantages.

Like if we talk about our country Bangladesh we all know that cryptocurrencies are still banned in our country. At the moment if our central bank plans to create such a currency then the authorities must decide more proactively for CBDC. Moreover, we know that cryptocurrencies are not yet supported by central banks and the weakness and volatility associated with them.

But one important thing is that these digital currencies play an important role in foreign transactions and remittances through CBDC. That is the future of payments. From physical to digital currency Further develops a country's digital infrastructure. Where currently many countries are included with this digital currency and offer such facilities to the citizens of that country through which they get many benefits from foreign transactions to receiving remittances within themselves.

As many of us currently know India is moving fast for a CBDC. However, China is reluctant and the US is not active in this regard. However, many digital currencies offer great benefits and even many countries have crypto ATMs or banks through which citizens can make various purchases.

Because central bank regulated CBDC has many advantages which is why it is now being incorporated in many countries. Because potential benefits of these digital currencies include improved transaction efficiency. Moreover, if this digital becomes popular, it is possible to reduce the cost of printing money, thereby freeing the central bank from additional costs. Also such currency circulation can be done effortlessly like improved security against fraud, and promotion of cashless economy to fight financial crime.

But one thing we have to keep in mind is that CBDCs are similar to existing cryptocurrencies. But there is a difference because unlike cryptocurrencies, CBDCs are backed by the country's financial system and are considered legal tender. Which we usually don't see in cryptocurrency. Unlike cryptocurrencies, acceptance of CBDC is mandatory for transactions, similar to traditional fiat money, which is a form of currency that is not backed by precious metals such as gold or silver.

Currently, Jamaica, Zimbabwe, Nigeria, and the Bahamas have officially launched CBDCs while many others are either researching, developing, or piloting similar programs. However, it is believed that these currencies will take over the market in the future. And physical money will take the place of that money.

But here one more thing we have to keep in mind that to conduct such activities must be the prevalence of internet and people need to be very skilled in this regard. Which can threaten the use of such digital entertainment in the case of citizens of underdeveloped countries. Inefficiency, inadequacy of internet and other issues must be thought of first. However such digital currency offers advantages as well as disadvantages so it remains to be seen and the future will tell whether it will take the place in the future.