#bursteem25|Steemit Engagement Challenge | S4W2 | Explanation of CBDCs by @rafk.

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Hello my friends my name is @rafk and I am overwhelmed to welcome you to the S4-W2 SEC. Hope we all prepared to learn and engage more than we did in S1.

Today I bring to you my review on the amazing topic of discussion which is indeed going to impact many audience once you are done reading this context.

Have your heard of CBDC before?. If not now is the time to open your mind to get it more. CBDC is short of Central Bank Digital Currency. Sounds interesting write? . Yes!!, let's ride on.

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What Do You Understand About CBDC (Central Bank Digital Currency)?

It's of no news, we have heard of digital currency over the past years, but this has been in the form of a decentralized currency. Example of pre-existing digital currency are: Bitcoin, Ethereum ...Etc.

These coins are self own and private to the sole owner and not even the government or the bank has priority over them. Now we are to discuss on digital currency involving a bank, this is kind of strange but let's get what CBDCs entails.

A Central Bank Digital Currency (CBDC) is a the digital form of Fiat money, exactly same value which is issued by the central bank to aid the already existing bank notes..

Rather than making it all printed money, the central bank will issue a digital coins or accounts which will be back by the central government, and this electronic coins will be use alongside with the paper money, anywhere, Anytime.

CBDCs, before someone get it mixed up with cryptocurrency, will be used on to transfer money or value, perform transactions just like the normal paper money . Cryptocurrency on the other hand are private money used to invest and perform other transaction on the Blockchain.

In addition with the coming of CBDC as speculated by the international monetary fund, it will ease the flow of money, provide quicker access to money through digital channels, and it my also go along way to reduce expenses as excess transaction charges will be limited.

Not to leave out a point, the digital currency is not coming to replace the already existing bank notes, but as an assistant to the paper money. So transactions will continue to go on as usual with the two.

Lastly the CBDC will be issue and regulated by the central bank. These digital currency will be back by the full faith and also credit of the government . So the coins will be issued much more like the bank notes.

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Does My Country Has Its Own CBDC? If Not, What's My Opinion About Its Presence In My Country.

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Digital Currency is something which will take quite some time to finally be adopted in Cameroon. As of present, the idea of Digital currency has not surface in my country yet. And i properly checked , over 70% of the country's population have no idea of the CBDC project.

Research shows that approximately over 104 countries have voted for the creation of the CBDC and amongst this number, over 50 of this countries are in the advance state to obtain the digital currency through the proceed of piloting, development and final lunch.

With the coming of the CBDCs, there are lots of domain which in my opinion will affect the country in various ways.

• Spread of disease such as covid and and infectious contact disease will be eradicated.

• There will be easy access to money since we will be able to perform faster transactions and save time.

I will love to see the implementation of CBDC in my country are and this are the famous problems we faced so far in my country. CBDC will also have numerous advantage as we will list them later in the context.

Importance Of CBDC In The Financial System.

With the CBDC in place, the financial system become more safer, as parties like; individuals, private company and non-financial institutions will be able to settle their transactions directly to the central bank rather than carrying out bank deposits. Thereby reducing the risk in payment system.

In addition, it will provide a genuine risk free substitute to banknotes, meaning a shift from bank notes to digital coin will limit the need for government approval on deposits, thereby elimination the risk of illegal transactions in the finance system.

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What Do I Think? If There Is Need Of My Country Or Not?

Coming to my country Cameroon, as I have already specify there are already existing problems we face using the Fiat currency paper money, like the cases of transfer of COVID, slow payments.

CBDCs will be highly welcome in my country and lots more but first of all there are a number of thinks to consider before it full implementation. I will specify some reasons here.

First of all My Country is a developing country and few has access to technology and also majority of the population have little knowledge on technology. So using CBDCs will be a major problem to many at the start especial the old.

So if the policy of adopting the CBDC and also using the Fiat bank notes is respected, without carrying out a complete switch to digital, then there will be 40% of the population ready to use CBDCs .

Advantages And Disadvantages Of CBDCs.

When dealing with bank note it major problem was durability, coming to CBDCs there are lots of pro and cons about the digital currency as i tabulate it below.

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Advantages	Disadvantages
CBDCs provide more efficient and secure payments	The Central banks have complete control over CBDCs .
It permit consumers to transact with the central bank directly	There's worry about the privacy for users.
The risk of a commercial bank collapse is eliminated	It will be difficult to attain widespread adoption of CBDCs

Is CBDCs A Global Need? What's My Opinion On It.

This question is great in the sense that, although we are striving for a global resolution of CBDCs , it also has to look in place whether it is safe to adopt the digital system with respect to the world's emergence.

If CBDCs are going to conquer the world, it should put in place a consideration that the world financial system is of electronic payment is still just minute.

So for any modifications the central bank should consider putting in place the CBDCs when the electronic payment system become normal and all necessary measure have been put in place for it security.

Once complete, then I think it is ready to go global with CBDCs because I really picture it future beneficial.

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CONCLUSION

To conclude, I will say the idea of CBDCs is a game changer to the financial system and although it might disrupt the system at the early stage when lunch but as long are all necessary measure are taken, we won't be finding much difficulties using CBDCs . Yes, the are it cons but the pros are much better taken care of.

I will love to see CBDCs in existence but I worry a lot about the security. If a good defence mechanism is implemented for the wallet and bank notes continue to be in supply, it will be a great idea.

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