Title: Central bank digital currency: features and functionality limitations

Authors: Saeed Banaeian Far; Mohamad Gul Dendar; Seyed Mojtaba Hosseini Bamakan

Addresses: Department of Electrical and Computer Engineering, Science and Research Branch, Islamic Azad University, Tehran, Iran ' Department of Management Sciences, Yazd University, Yazd, 89195-741, Iran ' Department of Management Sciences, Yazd University, Yazd, 89195-741, Iran

Abstract: The emergence of cryptocurrencies has motivated the central banks to issue a centralised and trusted digital currency instead of fiat currency named central bank digital currency (CBDC). CBDC is a substitute for fiat currency to meet some wants instead of cryptocurrency. However, it is still in the testing stage and has some challenges that should be addressed and focused on. The study of different research papers and published articles show three significant issues and many minor issues that reflect CBDC's challenges, including its functional limitations due to its used technology features, its effects on monetary policy, and its effects on commercial banks. The primary purpose of this study is to concisely present the previous work on the above three mentioned issues.

Keywords: blockchain; central bank digital currency; CBDC functionality limitations; cryptocurrency; digital currency; distributed ledger technology; DLT.

DOI: 10.1504/IJBC.2022.128884

International Journal of Blockchains and Cryptocurrencies, 2022 Vol.3 No.4, pp.353 - 376

Received: 20 May 2022
Accepted: 11 Sep 2022

Published online: 08 Feb 2023 *

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