- A CBDC also gives a country's central bank the tools it needs to undertake monetary policies that promote stability, growth, and inflation management.
- Digital currencies issued by central banks would also minimise the dangers associated with utilising digital currencies in their current form. Cryptocurrencies are extremely volatile, with their value fluctuating continuously.
- This unpredictability might put many households in financial distress and jeopardise an economy's general stability. CBDCs would provide a stable means of transferring digital currency to households, consumers, and companies if they were backed by the government and administered by a central bank.
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