Central Bank Digital Currencies:Implications for National Finan-cial Security and Response
In the digital era when the world is undergoing profound changes unseen in a century,central bank digital currencies(CBDCs)have become the focus of attention of the international communi-ty and an important means of maintaining national financial security.This paper intends to discuss the impacts of CBDCs on national financial security by expanding the connotations of national financial secu-rity into three dimensions:security of the financial system,security of national financial sovereignty,and financial tech-nology-related security.On the one hand,it finds that CBDCs can help maintain nation-al financial security through strengthened financial information security,reduced risks of financial crimes(e.g.money laun-dering and terrorist financing),and dimin-ished threats of private digital currencies to the security of national financial sovereign-ty.On the other hand,CBDCs may face challenges in their early stages of develop-ment spanning immature regulatory frameworks,technology-related risks and shocks,and vulnerable monetary sover-eignty.E-CNY has led the way in research and development of CBDCs.China should make good use of this first-mover advan-tage to explore the regulatory framework for e-CNY and promote international cooperation in cross-border areas.Impor-tantly,China should actively participate in international standards setting to gain advantages in the global digital currency competition,as part of effiorts to safeguard the security of its financial system,sover-eignty,and technology.
central bank digital currencyfinancial infrastructurenational financial security
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