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A guidebook for regulators and policymakers

This paper aims to provide an overview of the policy and regulatory considerations for central banks to build and issue a Central Bank Digital Currency (CBDC) and highlights the benefits of open networks.

Unlike centralized and closed systems, an open network with asset control capabilities for issuers means robust and resilient infrastructure upon which anyone can build. Under an open system, regulators, public agencies, and regulated financial entities, from commercial banks to digital wallets, can design solutions and monetary policies using a ledger that possesses built-in capabilities to ensure security, certainty, and control – as with a centralized or closed ledger. At the same time, open systems foster competition and innovation by expanding the access and usage of more affordable financial services in addition to promoting financial inclusion.

First, the paper intends to briefly set out how individuals and Micro, Small and Medium Enterprises (MSMEs) would benefit from CDCs, hence why central banks should consider issuing a CBDC as a central bank public good, giving the private sector greater scope for impactful innovation. Second, the paper addresses an important question: Why should a CBDC be built on an open blockchain? Third, the paper highlights regulatory and policy considerations when issuing a CBDC and concludes with final thoughts. This paper is not focused on the technology aspect of the Stellar network. In order to understand the necessary steps for a central bank to build a CBDC on Stellar, please see Stellar for CBDCs.


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