Banque de France Calls for Further Examination of Wholesale CBDCs

A wholesale CBDC would be of benefit to cross-border payments, the bank concluded.

Nov 9, 2021 at 9:58 a.m. UTC
Updated Nov 9, 2021 at 3:51 p.m. UTC

France’s central bank has concluded that further examination of wholesale central bank digital currencies (CBDC) is needed following its initial experiments.

  • The Banque de France’s experiment commenced in March 2020, with results published Monday.
  • “We have demonstrated that a wholesale CBDC would be of benefit for cross-border and cross-currency payments as it would improve the efficiency of processing chains,” said Nathalie Aufauvre, head of the bank’s experimentation program.
  • However, further examination is required of important questions pertaining to the role of financial intermediaries and the transmission of monetary policy, according to the Banque de France.
  • “It is essential, therefore, that central banks retain full control over a wholesale CBDC once it has entered circulation.”
  • A wholesale CBDC is a digital currency issued specifically for use by financial institutions to exchange central bank-issued money. In this sense, it is distinguishable from a retail CBDC that would be intended for use by the public as a form of digital cash.
  • The Banque de France is also exploring a retail CBDC as part of the European Central Bank’s broader work on the potential development of a digital euro.

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Jamie Crawley is a CoinDesk news reporter based in London.