## ftnea2025006 ## Source details **Canonical URL:** [ftnea2025006](https://www.imf.org/-/media/files/publications/ftn063/2025/english/ftnea2025006.pdf) ## Other formats - [Markdown version](/-/media/files/publications/ftn063/2025/english/ftnea2025006.pdf.md) - [Structured JSON version](/-/media/files/publications/ftn063/2025/english/ftnea2025006.pdf.json) --- ### I. Introduction — purpose and scope - Aim: Guide policymakers, including central banks, in assessing legal frameworks to ensure a sound basis for the issuance of central bank digital currencies (CBDCs). - Not a recommendation to issue CBDCs; purpose is to navigate authorities on key legal considerations guiding decision-making. - Emphasis: comprehensive review of legal frameworks and, where necessary, pursuit of legislative amendments prior to CBDC issuance to mitigate legal, financial, operational, and reputational risks. - Scope and assumptions: - Main focus on retail CBDC (rCBDC), with separate analysis of wholesale CBDC (wCBDC). - Excludes detailed treatment of cross-border use, taxation, civil procedure, administrative law, competition and interoperability with existing payment systems, capital flow management, privacy, and AML/CFT (only limited forays into private law areas). - Assumes rCBDC functions as “digital cash” distributed through intermediaries with the central bank retaining control over issuance and redemption (public–private partnership). - wCBDC analysis assumes wCBDC designs embedding issuance of tokens by the central bank and typically does not involve intermediaries. - Structure overview: Sections addressing (II) legal nature of rCBDC, (III) central banks’ legal mandates, (IV) legal relationships, (V) rCBDC functionalities, (VI) wCBDC legal aspects, (VII) conclusion, and an Annex summarizing key legal considerations. ### II. Legal nature of rCBDC in public law — definition and key features - Core definitional consensus: - rCBDC is (i) a liability of the central bank, (ii) available to the public, (iii) in inherently digital form, and (iv) designed to serve as money. - Public law implication: - rCBDC issuance is governed principally by central bank law and monetary law; legal frameworks may need adjustment depending on functional definitions and design features. ### III. Liability of the central bank - Characterization and practice: - Jurisdictions generally characterize rCBDC as a liability of the central bank. - Examples preserved exactly as presented: - Bank of Jamaica Act 2022 provides that “monetary liabilities” include notes, coins, and central bank digital currency. - Regulatory Guidelines on the eNaira 2021 states the eNaira is a direct liability of the Central Bank of Nigeria. - Central Bank of The Bahamas’ 2022 financial statements list its rCBDC “Sand Dollar in circulation” under “financial liabilities.” - Implications: - rCBDC is a credit risk-free instrument relative to privately issued instruments (for example, electronic money or some types of stablecoins). - Indirect risks: expansion of central bank balance sheet, change in allocation of central bank assets, reduction in retail deposits at commercial banks (discussed in Section V). - Consistency requirement: - Legal framework should ensure rCBDC remains a central bank liability regardless of architecture or distribution mechanism (example: China’s e-CNY as direct liability of the PBOC in a two-tier architecture). - Note on synthetic/indirect CBDC: - Indirect liability or synthetic CBDC is not CBDC; liabilities of commercial banks, even if fully backed by central bank liabilities, are not central bank liabilities (see Bechara and others 2025). ### IV. Availability to the general public - Distinguishing feature: - rCBDC is intended for broad public availability—households and businesses can make payments and store value using digital central bank money, unlike central bank reserves limited to eligible institutions. ### V. Inherently digital — legal implications - Digital-form consequences: - Some legal provisions for physical currency may be irrelevant (for example, multiple denominations). - Example: Reserve Bank of India Act, 1934 amendments broadened “banknote” to include currency in digital form and explicitly disapplied sections 24, 25, 27, 28, and 39 to rCBDC. - New legal risks and needs: - Rules needed for transfer of rCBDC, loss, illegal transfers, good-faith acquisition, and insolvency effects on rCBDC transactions. - Cybersecurity threats may not be captured by existing laws; jurisdictions should assess obsolescence of legacy provisions and consider proactive legislation for digital-era monetary risks. ### VI. Designed to serve as money — denomination and cash-like attributes - Functional requirements: - rCBDC must be denominated in an existing unit of account and serve as medium of exchange and store of value; rCBDC is a means of payment issued in the existing official unit. - Cash-like objectives and limits: - Jurisdictions may set limits on rCBDC use as medium of exchange or store of value. - rCBDC conceptualized as “digital cash” with attributes: recognition as legal tender (or currency) and potential offline functionality. - Full replication of cash attributes (for example, anonymity and fully risk-free offline use) is challenging; rCBDC aims for functional equivalence preserving convenience, accessibility, and trustworthiness. ### VII. rCBDC as currency — five legal mechanisms for state sanction - Five mechanisms by which State can sanction currency status (as presented): - Monopoly of issuance by the State (or its agent). - Cours forcé. - Legal tender status. - Privileges under private law. - Protection under criminal law. - Examples and implications: - Monopoly of issuance: Bank of Jamaica Act example—“the Bank shall have the sole right and authority to issue notes, coins and central bank digital currency.” - EU: ECB exclusive right to authorize the issue of the digital euro; ECB and national central banks may issue it. - Cours forcé: legislation should confer cours forcé status when rCBDC is currency (EU draft digital euro regulation quote preserved). - Commercial implication: merchants cannot charge extra for using rCBDC; they may discount other methods instead. ### VIII. Cours forcé, convertibility, and legal tender nuances - Cours forcé and convertibility: - Cours forcé concerns nominal value; legal tender concerns power to extinguish debt; distinct from convertibility. - Law should require rCBDC be convertible at par with other central bank money available to the public. - Examples preserved exactly as presented: - Draft digital euro regulation: “the digital euro shall be convertible with euro banknotes and coins at par.” (Article 4(1) of the draft digital euro regulation). - Nigeria: eNaira guarantees a 1:1 exchange between the eNaira and the physical Naira cash (Section 1.0 of the Regulatory Guidelines on eNaira 2021). - Ghana: eCedi designed to be convertible 1:1 into commercial bank deposit money (Bank of Ghana 2022). - Technical convertibility caveat: legal convertibility requires technical interoperability; rights may be unenforceable without it. - Legal tender: - No global definition; commonly power to extinguish payment obligations. - Mandatory acceptance varies; some laws impose administrative or criminal penalties, others allow contractual derogation. - Examples: - Bank of Jamaica Act amendment: “CBDC shall be legal tender for the payment of any amount.” (Section 15 of the Bank of Jamaica Act, as amended in 2022). - Ukraine amendment: digital currency is a legal tender in Ukraine (Article 35 of the Law on the National Bank of Ukraine). - Policy considerations: whether to oblige acceptance given technical infrastructure, digital literacy, privacy concerns; justified and proportionately limited scope of legal tender may be considered. ### IX. Private-law privileges and criminal protection - Private-law privileges and title protection: - Extending good-faith acquirer protections to rCBDC supports circulation as “digital cash” but is legally challenging due to intangibility; would require robust legal framework. - Historical precedent referenced: Miller v. Race (1758) for banknotes. - Criminal law and cybercrime: - Update criminal laws to extend protections (monopoly of issuance, legal tender recognition, counterfeiting prohibitions) to rCBDC. - Novel cybercrime risks: unauthorized access, hacking, wallet exploitation, smart contract manipulation. - Jurisdictional steps (examples preserved): - The Bahamas’ 2020 legislation criminalizes counterfeiting or alteration of electronic money designated as legal tender. - Jamaica’s 2022 Bank of Jamaica Act prohibits unauthorized issuance of rCBDC, with penalties. - Draft amendments to China’s Law on the People’s Bank of China impose fines and confiscation for unauthorized digital tokens intended to replace the renminbi. ### X. rCBDC and the legal mandate of central banks - Principle: central bank must have statutory authority to issue rCBDC under attributed powers. - Observations: - Most existing central bank laws do not clearly empower issuing digital currency directly to the public; traditional authorizations focus on physical banknotes/coins and accounts for banks and government. - Introducing rCBDC for households/businesses typically requires new legislation or reinterpretation of existing law. - Benefits of explicit legislative mandate: - Mitigates legal, financial, and reputational risks, bolsters legitimacy, reduces legal challenges. - Bank of England and HM Treasury indicated primary legislation would be enacted before any digital pound launch (Bank of England and HM Treasury 2024). - Governance effects: - rCBDC issuance impacts central bank governance; need to preserve autonomy and delineate roles between central bank and political authorities. - Central banks may need internal decision-making structures and specialized committees with technical and legal expertise (Bechara and others 2021). ### XI. Legal foundation to issue rCBDC as currency and account access - Statutory vesting: - Jurisdictions should explicitly vest rCBDC issuance function in the central bank through statute. - Examples preserved exactly: - Bank of Jamaica Act: define rCBDC as “a digital form of currency.” (Section 2) and enable issuance/redemption (Section 5). - ECCB Agreement amended to clarify currency includes digital currency for “DCash” pilot (Article 2). - Central bank current accounts for public: - Most central bank laws do not permit public current accounts; enabling them requires legislative amendments. - Two-tier models predominate to avoid retail central bank accounts and related risks (competition with banks, operational capacity, privacy). ### XII. Legal foundation to deploy rCBDC platforms and front-end roles - Statutory mandate for platform ownership/operation: - Many central bank laws mandate promoting safe and efficient payment systems; mandates may be limited to wholesale systems—legal reform may be needed for retail platforms. - Equity participation and systemic importance: - If central bank acquires equity in platform operators, legal frameworks permitting such participation are required. - rCBDC payment platform may be designated systemically important; PFMI compliance and strong oversight needed. - Front-end roles in two-tier systems: - Central bank may provide basic public wallets or default services to ensure universal access. - Such retail-facing operations must be authorized by statute (examples: EU legislated public options; Nigeria’s central bank–managed eNaira wallet app). ### XIII. Outsourcing, contractual safeguards, and PFMI considerations - Outsourcing: - Outsourcing software development, cybersecurity, and operations is possible, but central bank must retain full control through legal and contractual arrangements; public authority remains accountable. - Contracts should ensure central bank ownership of core intellectual property, fallback arrangements, enforceable intervention rights, audit access, and business continuity obligations. - PFMI applicability: - PFMI standards apply to systemically important FMIs an rCBDC platform could be; key legal considerations under PFMI include Legal Foundation and Settlement Finality (Principles 1 and 8), Governance (Principle 2), and Operational Resilience (Principle 17). - Contractual safeguards, portability, and exit: - Develop exit strategies if third-party operator fails, with rights to step in, access source code, port data, and ensure smooth transition. - Mitigate third-party lock-in and data portability issues through contracts and legal/regulatory powers. ### XIV. Dual central bank role: operator and regulator — conflict mitigation - Inherent conflict of interest if central bank both operates an rCBDC platform and regulates payment systems. - High-level mitigation measures: - Independent oversight board (example: Payments System Board in Australia—Section 25A of the Reserve Bank of Australia Act). - Enhanced transparency and regular audits; public consultation for major regulatory decisions. - Internal separation (“Chinese walls”) between operational and regulatory teams with separate reporting lines. - Periodic public reporting on rCBDC platform performance and market interactions. ### XV. Mandating participation and portability of rCBDC service providers - Mandatory participation: - Some jurisdictions consider compelling major intermediaries to participate to ensure universal availability and adoption. - Examples preserved: - Central Bank of Nigeria Regulatory Guidelines required all licensed financial institutions to serve as eNaira intermediaries. - EU draft digital euro legislation stipulates credit institutions providing specific payment services must offer basic digital euro services on request. - Legal constraints: mandatory participation must be justified by public interest and proportionate; consider exemptions and cost recovery. - Portability powers: - Central banks may be granted authority to transfer users’ wallets/accounts to alternative providers in exceptional cases (insolvency; data loss/outage). - Legal frameworks should define trigger events, protections for users, and interaction with insolvency/resolution regimes. - Example: proposed digital euro regulation envisions authority for the ECB to permit transfer where a provider loses necessary data. ### XVI. Legal relationships in an rCBDC landscape — types and key legal priorities - Three principal relationship categories to assess: - Central bank–users: - Asset link: rCBDC as direct central bank liability; classification of platform accounts as identification tools vs financial accounts (current accounts or safeguarding accounts) affects obligations. - Technological link: central bank responsibilities where it provides technological access; outsourcing does not remove ultimate responsibility. - Priority: law must ensure rCBDC remains a direct liability and users’ holdings are protected from intermediary insolvency. - Central bank–intermediaries: - Intermediaries likely fall under payment law; need possible new licensing regimes and rulebooks governing platform participation, compliance, liability allocation, data sharing, and dispute resolution. - Authorities should review payment concepts (for example, “transfer” and “funds/money”) to determine legal treatment of rCBDC services. - Intermediaries–users: - Where rCBDC services are regulated, user–intermediary relationships governed by payment law and contracts. - Key design priorities: ring-fence users’ holdings from intermediaries’ estates (safekeeping, custody, trust), contingency mechanisms for user access if intermediaries fail (wallet portability), and clarity on indemnification and liability allocation. ### XVII. General legal principles and immunities - Fundamental principles for rCBDC design: - Non-discrimination, proportionality, access to justice, and protection of property rights. - Immunities and agency: - Central banks acting as public authorities may benefit from immunities for acts in pursuit of mandate (subject to exceptions for intentional wrongdoing or gross negligence). - Agency principles: principals remain responsible for agents’ actions within authority—outsourcing does not eliminate central bank responsibility. - Legal risks absent explicit contracts: - Central bank may face non-contractual liability (tort, administrative law) even without direct contracts with users. - Illustrative pilot example: ECCB guaranteed all funds on the Dcash network against losses due to infrastructure failure for the duration of the pilot. ### XVIII. Limits on rCBDC holdings, transactions, and fees - Purpose and legal grounding: - Limits on holdings and transactions aim to mitigate disintermediation risks and preserve financial stability; must be grounded in law. - Mechanisms and concerns: - “Waterfall mechanism” proposals (redirecting excess rCBDC to bank accounts) raise property rights concerns as they convert central bank money into bank deposits. - Authority to set limits should primarily rest with the central bank, possibly coordinated with government; codifying limits into law could reduce adaptability. - Jurisdictional approaches preserved exactly: - Bank of England proposes a £10,000–£20,000 cap during the digital pound’s rollout. - China applies tiered limits based on user identification levels. - Nigeria’s eNaira imposes wallet limits ranging from 120,000 to 5,000,000 Naira for individuals, with no cap for merchants. - Transaction fees and caps: - Fee caps should be justified and proportionate; example: draft digital euro regulation aims to ensure free basic digital euro services for residents. - Some regulators lack explicit power to regulate fees unless empowered by law. ### XIX. Interest-bearing rCBDC, programmability, and offline functionality - Interest-bearing rCBDC: - Majority of projects envisage non-remunerated rCBDC. - Examples preserved: - Bank of England envisions the digital pound like a digital banknote, with zero interest. - Russian law prohibits interest on digital ruble balances (National Payment System Law, Article 30.8(4)). - China’s e-CNY and India’s e₹-R do not pay interest. - Some central banks (for example, Bank of Israel) consider interest-bearing options; remuneration could affect monetary transmission. - Programmability: - Programmable money = digital money encoded with conditions on its use. - Most authorities stated they will not make rCBDC programmable in restrictive ways. - Legal concerns: programmability may conflict with legal tender, convertibility, property rights; could resemble expropriation if expirations applied without due process. - Distinction: programmable payments (user-initiated conditional payments) differ from programmable money; legal frameworks may need updates for smart contracts, enforceability, liability, and interoperability. - Offline rCBDC transactions: - Offline modes (fully offline; intermittently offline; staged offline) support resilience and inclusion; require legal clarity on settlement finality and singleness of money. - Legal provisions may clarify finality timing, legal tender status for offline/online, convertibility at par, compensation/liability for losses, and good-faith purchaser rules for stolen offline value. - Example preserved: Draft digital euro regulation provides final settlement occurs at the moment of updating payer/payee local storage records. ### XX. Selected legal aspects of wCBDC (definition, mandate, risks) - Definition used: wCBDC = tokenized central bank money accessible only to predefined entities, typically financial institutions. - Economic treatment: - wCBDC intended to be fully fungible with reserves; economically similar to reserves (remuneration, HQLA status, accounting). - Legal aspects and risks: - Need legal certainty over token validity and linking tokens to underlying assets; risk of desynchronization between token ledgers and RTGS systems leading to double spending or unbacked tokens. - Law should address transfer rules (loss, illegal transfers, good-faith acquisition) and insolvency effects. - Mandate and operational questions: - Determine whether existing central bank law suffices for wCBDC issuance (reserves-equivalent) or whether legislative reform is required to avoid ultra vires risk. - Opening accounts and recording token form may require legal reform. - Central bank powers to own/operate or outsource wCBDC platforms need statutory clarity; outsourcing is possible in some jurisdictions (example reference to Switzerland and Project Helvetia under Swiss law). - Settlement finality: - Legal frameworks should explicitly recognize settlement finality for wCBDC; probabilistic settlement designs require legal definitions (for example, after percentage of validators confirm or several blocks are added). ### XXI. Conclusion — principal legal findings and implications - Purpose reiterated: assist policymakers in identifying and addressing key legal issues relevant to CBDC issuance, primarily rCBDC with separate wCBDC analysis. - Principal findings summarized (preserved language and points): - rCBDC is a central bank liability and credit risk-free compared with privately issued instruments. - Public availability distinguishes rCBDC from other digital central bank liabilities; jurisdictions may view rCBDC as “digital cash” with currency status implications (exclusive issuance right; payments honoring face value; 1:1 convertibility). - Authorities can extend administrative and criminal protections to rCBDC issuance monopoly and legal tender status and penalize rCBDC cybercrime and fraud. - Clear statutory mandate for rCBDC issuance reduces legal risk; many central bank laws need updating. - Two-tier public–private partnership models predominate; central bank platform ownership/operation requires legal authority; outsourced operations demand retained control and contractual safeguards. - If systemically important, rCBDC platforms should align with PFMI standards and governance must address conflicts of interest. - Legal frameworks must license, regulate, and supervise intermediaries; consider powers for wallet/account portability in exceptional cases. - Legal relationships to assess: central bank–users (asset and technological links), central bank–intermediaries, and intermediaries–users. - rCBDC functionalities requiring legal grounding: holding/transaction limits, fees, interest accrual, programmability, offline payments. - wCBDC legal aspects: ensure mandate to issue, token legal certainty, platform operation/outsource rules, and explicit settlement finality provisions. ### XXII. Annex — selected legal considerations and practical approaches (highlights) - Legal nature and status (items 1–3): - 1 rCBDC: a digital form of central bank money available to the general public — jurisdictions should qualify rCBDC as a liability of the central bank (examples: Bank of Jamaica Act 2022; Regulatory Guidelines on the eNaira 2021; Reserve Bank of India Act, 1934 (as amended)). - 2 rCBDC: intermediary insolvency remote — rCBDC should remain a central bank liability in any architecture (example: China’s e-CNY two-tier architecture). - 3 rCBDC: currency status — law should recognize rCBDC as currency where intended to be digital cash (examples preserved: Bank of Jamaica Act 2022; EU draft digital euro regulation; Ukraine amendment; Bahamas’ Central Bank Act 2020). - Retail CBDC mandate and platform operations (items 4–10): - 4 Legal mandate to issue rCBDC — vest issuance in central bank statute; pilots may require amendments (examples: Bank of Jamaica Act 2022; ECCB Agreement amendment for “DCash”). - 5 Authority to own/operate rCBDC platforms and front-end involvement—statutory authorization needed (examples: PBOC law; Central Bank of Malaysia Act; draft digital euro regulation). - 6 PFMI standards for rCBDC platforms — review compliance with PFMI Principles 1, 8, 2, 17. - 7 Outsourcing — ensure legal permissibility and retained control; require security, audits, continuity, and intervention rights. - 8 Dual roles — governance mechanisms to mitigate conflicts (independent oversight, transparency, internal separation, reporting). - 9 Regulation/supervision of intermediaries — robust legal framework; mandatory participation proportionate and justified (examples: BDDC Regulations, 2021; draft digital euro regulation; Central Bank of Nigeria Guidelines). - 10 Wallet/account portability authority — legal basis for transfers in exceptional cases (example: draft digital euro regulation). - Legal relationships (items 11–15) and specific functionalities (items 16–18) preserved as listed in the Annex. - Selected wCBDC aspects (items 19–22): legal mandate, tokenization, operation/outsource, and settlement finality requirements summarized as listed. *International Monetary Fund — FINTECH NOTES Selected Legal Considerations for Central Bank Digital Currencies (ftnea2025006)* ### References ............................................................................................................. ### ftnea2025006 - References ### I. Introduction — Purpose and scope - Aim: Guide policymakers, including central banks, in assessing legal frameworks to ensure a sound basis for the issuance of central bank digital currencies (CBDCs). - Not a recommendation to issue CBDCs; purpose is to navigate authorities on key legal considerations guiding decision-making. - Emphasis: comprehensive review of legal frameworks and, where necessary, pursuit of legislative amendments prior to CBDC issuance to mitigate legal, financial, operational, and reputational risks. - Builds on earlier LEG publications: - IMF Working Paper (Bossu and others 2020) examining legal foundations of retail CBDC under central bank law and monetary law. - IMF Fintech Note (Bechara and others 2025) analyzing private law aspects of token-based CBDCs primarily intended for retail use. - Scope limitations: - Main focus on retail CBDC (rCBDC), with separate analysis of wholesale CBDC (wCBDC). - Excludes detailed treatment of cross-border use, taxation, civil procedure, administrative law, competition and interoperability with existing payment systems, capital flow management, privacy, and AML/CFT (only limited forays into private law areas). - Assumes rCBDC functions as “digital cash” distributed through intermediaries with the central bank retaining control over issuance and redemption (public–private partnership). - wCBDC analysis assumes wCBDC designs embedding issuance of tokens by the central bank and typically does not involve intermediaries. - Structure: Section II — legal nature of rCBDC under public law; Section III — central banks' legal mandates in issuing rCBDC; Section IV — legal relationships in rCBDC landscape; Section V — rCBDC functionalities; Section VI — wCBDC legal aspects; Section VII — conclusion; Annex — summary table of key legal considerations. ### II. The legal nature of rCBDC in public law — definition and key features - Core definitional consensus (from multiple authorities cited): - rCBDC is (i) a liability of the central bank, (ii) available to the public, (iii) in inherently digital form, and (iv) designed to serve as money. - Public law relevance: - rCBDC is designed to be issued by a public authority; central bank law and monetary law will mainly govern its nature and authority for issuance. - Legal frameworks may need adjustment depending on functional definition and design features. ### III. Liability of the central bank - Characterization: - Jurisdictions exploring or issuing rCBDC generally characterize it as a liability of the central bank. - Legal examples: Bank of Jamaica Act 2022 provides that “monetary liabilities” include notes, coins, and central bank digital currency; Regulatory Guidelines on the eNaira 2021 states the eNaira is a direct liability of the Central Bank of Nigeria. - Accounting practice example: Central Bank of The Bahamas’ 2022 financial statements list its rCBDC “Sand Dollar in circulation” under “financial liabilities.” - Implications: - As a central bank liability, rCBDC is a credit risk-free instrument, unlike privately issued instruments (for example, electronic money or some types of stablecoins). - Indirect risks: expansion of central bank balance sheet, change in allocation of central bank assets, reduction in retail deposits at commercial banks (discussed in Section V). - Consistency requirement: - Legal framework should ensure rCBDC remains a central bank liability regardless of architecture or distribution mechanism. - Example: China’s e-CNY is a direct liability of the PBOC in a two-tier architecture where PBOC handles issuance and redemption and intermediaries provide services; intermediaries’ insolvency should not affect e-CNY value held by users. - Note on synthetic/indirect CBDC: - Strictly speaking, indirect liability or synthetic CBDC is not CBDC; liabilities of commercial banks, even if fully backed by central bank liabilities, are not central bank liabilities (see Bechara and others 2025). ### IV. Availability to the general public - Distinguishing feature: - rCBDC is intended for broad public availability, unlike central bank reserves which are limited to eligible institutions. - Enables households and businesses to make payments and store value using a digital form of central bank money. ### V. Inherently digital — legal implications - Digital form consequences: - Some legal provisions for physical currency may be irrelevant (for example, multiple denominations). - Example: India’s amendments to the Reserve Bank of India Act, 1934 broadened the definition of “banknote” to include currency in digital form and explicitly disapplied sections relevant only to physical currency (sections 24, 25, 27, 28, and 39) to rCBDC. - New legal risks: - Need rules governing transfer of rCBDC, loss, illegal transfers, good-faith acquisition, and the impact of insolvency on rCBDC transactions. - Emerging cybersecurity threats may not be captured by existing laws; jurisdictions should assess obsolescence of legacy provisions and consider proactive legislation for digital-era monetary risks. ### VI. Designed to serve as money — denomination and cash-like attributes - Functional requirements: - rCBDC must be denominated in an existing unit of account and serve as medium of exchange and store of value. - Designating rCBDC as currency allows it to serve as money; rCBDC is not a new “currency unit” but a means of payment issued in the existing official unit. - Cash-like objectives and limits: - Jurisdictions may set limits on rCBDC use as medium of exchange or store of value (see Section V). - Jurisdictions conceptualize rCBDC as “digital cash” with key attributes: recognition as legal tender (or currency) and potential offline functionality. - Full replication of cash attributes (for example, anonymity and fully risk-free offline use) is challenging in a digital environment; rCBDC aims for functional equivalence preserving convenience, accessibility, and trustworthiness. ### VII. rCBDC as currency — five legal mechanisms for state sanction - To be legally classified as currency, rCBDC must possess currency features and typically be sanctioned by the State through: - Monopoly of issuance by the State (or its agent). - Cours forcé. - Legal tender status. - Privileges under private law. - Protection under criminal law. - Monopoly of issuance: - State monopoly should extend to rCBDC if equated with “currency.” - Example: Bank of Jamaica Act provides “the Bank shall have the sole right and authority to issue notes, coins and central bank digital currency.” - In the EU, the ECB will have the exclusive right to authorize the issue of the digital euro; the ECB and national central banks may issue it. - Cours forcé: - Contemporary meaning: value of a banknote equals the amount of the official monetary unit printed upon it. - Legislation should confer cours forcé status on rCBDC where rCBDC is currency. - Example: EU draft digital euro regulation provides that “the monetary value of digital euro tendered in payment of a debt shall be equal to the value of the monetary debt.” - Commercial implications: merchants cannot charge an additional amount for using rCBDC; merchants could offer discounts on other payment methods, which legally reward use of alternatives rather than imposing an extra charge for rCBDC. *ftnea2025006 - References (Selected Legal Considerations for Central Bank Digital Currencies, Fintech Note excerpt)* ### Section 12(1) of the Bank of Jamaica Act, as amended in 2022. ### Section 12(1) of the Bank of Jamaica Act, as amended in 2022 ### Cours forcé, convertibility, and rCBDC design implications - Cours forcé: historical concept where banknotes declared legal tender by law were not convertible into gold or silver; individuals and institutions were legally required to accept paper currency at face value even if not backed by specie. - Distinction: cours forcé focuses on nominal value; legal tender concerns the power to discharge debt; separate from convertibility. - Convertibility requirements for rCBDC: - Law should explicitly require rCBDC be convertible at par with other central bank money available to the public to ensure users can freely choose between forms of retail central bank money. - Draft digital euro regulation: “the digital euro shall be convertible with euro banknotes and coins at par.” (Article 4(1) of the draft digital euro regulation). - Nigeria: eNaira guarantees a 1:1 exchange between the eNaira and the physical Naira cash (Section 1.0 of the Regulatory Guidelines on eNaira 2021). - Ghana: eCedi designed to be convertible 1:1 into commercial bank deposit money (Bank of Ghana 2022). - Draft digital euro design foresees convertibility at par with “scriptural money” and electronic money. - Design-related legal issues: - Programmable money might lead to market value differing from nominal value. - If rCBDC lacks “full” legal tender status like banknotes, it may be viewed as a “weaker” form of central bank money. - rCBDC that holds interest could have a market value different from banknote nominal value. - Technical convertibility caveat: legal convertibility requires technical convertibility (interoperability); legal rights to convert may be unenforceable if technical interoperability is absent. ### Legal tender: scope, challenges, and statutory practice - No globally established legal definition of legal tender; national laws typically do not provide a comprehensive definition. - Common legal tender feature: power to extinguish payment obligations and discharge debtor once accepted. - Mandatory acceptance varies by jurisdiction: - Some countries impose mandatory acceptance with administrative or criminal penalties; others allow derogation via contractual freedom. - Draft digital euro regulation includes exceptions to mandatory acceptance (for example, natural persons acting in purely personal or household activities). - rCBDC legal tender practice and statutory examples: - Bank of Jamaica Act amended to provide that “CBDC shall be legal tender for the payment of any amount.” (Section 15 of the Bank of Jamaica Act, as amended in 2022). - Ukraine: amended central bank law provides that the digital currency is a legal tender in Ukraine (Article 35 of the Law on the National Bank of Ukraine). - Policy considerations: - Authorities must assess whether to oblige general public to accept rCBDC given dependence on technical infrastructure, varying digital literacy, and privacy concerns. - A justified and proportionately limited scope of legal tender could be considered for rCBDC. - rCBDC legal tender status may face challenges related to programmability and offline functionality. ### Private-law privileges and title protection for rCBDC - Traditional private-law privileges for physical currency (e.g., protection for good faith acquirers, nemo dat quod non habet exceptions) support circulation as “digital cash.” - Intangibility of rCBDC presents legal challenges to extending privileged status of physical currency. - Extending similar exemptions to rCBDC (so good faith acquirers retain title even if rCBDC initially obtained unlawfully) would require robust legal framework to preserve liquidity and transactional certainty. - Reference to precedent: Miller v. Race (1758) - banknote received in good faith conferred full legal title. ### Criminal law protection and cybercrime risks - Need to update criminal laws to extend sanctions protecting physical currency to rCBDC, including monopoly of issuance, legal tender recognition, and counterfeiting prohibitions. - New cybercrime vulnerabilities with rCBDC: unauthorized access, hacking, exploitation of digital wallets, smart contract manipulation. - Some traditional counterfeiting crimes may be inapplicable for ledger-based rCBDC relying on cryptographic validation and ledger immutability, but novel criminal concerns arise. - Legal principle: modernize laws in line with nullum crimen sine lege, nulla poena sine lege. - Jurisdictional steps: - The Bahamas’ 2020 legislation criminalizes counterfeiting or alteration of electronic money designated as legal tender. - Jamaica’s 2022 Bank of Jamaica Act prohibits unauthorized issuance of rCBDC, with penalties for violations. - Draft amendments to China’s Law on the People’s Bank of China impose fines and confiscation for unauthorized digital tokens intended to replace the renminbi. ### rCBDC and the legal mandate of central banks - Principle: under attributed powers, central bank must have statutory authority to issue rCBDC. - Most existing central bank laws do not clearly empower issuing digital currency directly to the public; traditional authorizations focus on physical banknotes and coins and accounts for banks, financial institutions, and government. - Introducing rCBDC accessible to households and businesses typically requires new legislation or reinterpretation of existing law. - Explicit legislative mandate benefits: - Mitigates legal, financial, and reputational risks. - Bolsters legitimacy and reduces risk of legal challenges. - Bank of England and HM Treasury indicated primary legislation would be enacted before any digital pound launch to define features and governance (Bank of England and HM Treasury 2024). - Governance effects: - rCBDC issuance would significantly affect central bank governance, requiring preservation of central bank autonomy and delineation of roles between central bank and political authorities. - Central banks may need to adjust internal decision-making structures and oversight committees to hold sufficient technical expertise and legal authority for specialized committees (Bechara and others 2021). ### Legal foundation to issue rCBDC as currency and account access - Jurisdictions should explicitly vest rCBDC issuance function in the central bank through statute. - Example statutory amendments: - Bank of Jamaica Act amended to define rCBDC as “a digital form of currency.” (Section 2 of the Bank of Jamaica Act, as amended in 2022). - Enabling clauses specify that the Bank of Jamaica may issue and redeem digital currency as part of its functions. (Section 5 of the Bank of Jamaica Act, as amended in 2022). - ECCB Agreement amended to clarify that currency includes digital currency when ECCB started its rCBDC (DCash) pilot (Article 2). - Central bank current accounts for general public: - Most central bank laws do not permit opening current accounts for the general public; enabling public current accounts would require legislative amendments. - Two-tier models predominate in practice to avoid central bank retail-account provision and its risks (competition with banks, operational capacity, privacy). - Two-tier model: private-sector intermediaries provide rCBDC wallets or service accounts (front-end) while central bank operates core ledger and issuance (back-end). ### Legal foundation to deploy rCBDC payment platforms and front-end roles - Statutory mandate needed for central bank to own and operate an rCBDC payment platform under attributed powers. - Many central bank laws mandate promoting safe and efficient payment systems and empower central banks to operate payment systems, but mandates may be limited to wholesale (interbank) systems. - Legal reform may be needed to clarify retail payment platform ownership and operation as within central bank remit. - Equity participation: if rCBDC platform operated by entity partly or wholly owned by central bank, legal framework should permit such equity participation; some central bank laws broadly prohibit acquiring shares unless authorized. - Systemic importance and PFMI: rCBDC payment platform might be designated systemically important, requiring PFMI compliance and strong oversight; gaps or interpretative issues could necessitate further guidance or legal reforms. - Front-end roles in two-tier systems: - Central bank may provide basic public rCBDC wallets or default services to ensure universal access for underserved segments. - Such front-end engagement must align with mandate and public interest objectives (financial inclusion, resilient universal access). - EU: legislated approach recognizing central bank competence to provide front-end services as public options. - Nigeria: launched a central bank–managed eNaira wallet app under its existing legal mandate. - Any retail-facing operations must be authorized by central bank statute. *FINTECH NOTES — Selected Legal Considerations for Central Bank Digital Currencies, INTERNATIONAL MONETARY FUND* ### Section 7 of the Reserve Bank of Australia (RBA) Act establishes that the RBA “is capable of acquiring, holding and disp ### Section 7 of the Reserve Bank of Australia (RBA) Act establishes that the RBA “is capable of acquiring, holding and disposing of real and personal property.” ### Legal basis for central bank activities and subsidiaries - Section 7 of the RBA Act: the RBA “is capable of acquiring, holding and disposing of real and personal property.” - Section 8 of the RBA Act: gives the Bank “such powers as are necessary for the purposes of this Act,” a list of specific powers, and a broad catch-all power “to do anything incidental to any of its powers.” - Interpretation: the combination of general and incidental powers permits the RBA to undertake activities needed to fulfill its functions, including creating or acquiring a subsidiary to conduct banknote printing. ### Outsourcing rCBDC platform operations to a third party - Outsourcing is possible for functions such as software development, cybersecurity, and day-to-day operation under oversight, but central banks must ensure outsourcing is legally permissible and that the central bank retains full control through legal and contractual arrangements. 43 - Public law consideration: issuance of currency might be deemed a core sovereign activity that must remain in-house; outsourced activities must be incidental or ancillary and not affect the overall public responsibility of the central bank. 44 - Contracts and oversight mechanisms should safeguard the public interest. 45 - The central bank must retain control over the rCBDC platform to protect monetary sovereignty. 46 - Central bank contractual and statutory powers should ensure: - central bank ownership of intellectual property in the core technology; - fallback arrangements; - enforceable rights to intervene unilaterally in platform operations when necessary to fulfill its mandate. - Oversight obligations of the central bank over third-party performance include cybersecurity and data protection compliance, continuous access for audit and inspections (with regular reporting), and requirements for effective business continuity and contingency plans. - A third-party operator does not relieve the central bank of legal responsibility for platform continuity and integrity; public authority remains accountable for outsourced functions. 47 - Contracts may include explicit protections such as indemnity clauses to cover losses caused by third-party operator faults, though indemnities are partial safeguards because ultimate responsibility remains with the central bank. 48 ### PFMI standards and rCBDC payment platforms (Box 2) - PFMI applicability: - The Principles for Financial Market Infrastructures (PFMI) set international standards for systemically important financial market infrastructures (FMI). - Central banks should apply PFMI to FMIs they operate. - Depending on system design and role in the financial system, an rCBDC payment platform may be designated as systemically important, making PFMI standards applicable. [1] - Key (non-exhaustive) legal considerations under PFMI: - Legal Foundation and Settlement Finality (Principles 1 and 8): - Ensure a well-founded, enforceable legal framework for all material activities. - For rCBDC platforms: clear authority to issue rCBDC, status of currency, direct liability of issuing central bank, and treatment of programmability or offline transactions. - Settlement finality must be legally clarified to provide irrevocable and unconditional payments; distributed ledger models and offline rCBDC transactions require careful legal and system-rule definitions of when finality occurs. - Governance (Principle 2): - FMIs need transparent governance promoting safety, efficiency, and financial stability and supporting public and stakeholder interests. - For rCBDC platforms: ensure independent oversight (for example, a committee overseeing operations) and stakeholder input (government, private intermediaries, end-users). - Address accountability when a central bank regulates its own rCBDC platform. - Legal and Contractual Arrangements for Operational Resilience (Principle 17): - Identify and mitigate operational risks, including business continuity and information security. - Disruption or cyberattack on an rCBDC platform could have immediate systemic effects; outsourced platforms should be properly regulated to minimize downtime and prevent data breaches or fraud by legal and contractual means. - Ensuring continuous availability and rapid recovery from outages is a legal mandate to preserve trust in a new form of currency. - Note: PFMI are soft law but widely recognized authoritative benchmarks for FMI design and oversight. ### Contractual safeguards, portability, and exit strategies - Central banks should develop an “exit strategy,” supported by legal and contractual measures, in case a third-party rCBDC operator fails or must be replaced. - Contracts with operational partners should embed rights for the central bank to: - step in; - access source code; - port data; - smooth transition operations if needed. - Outsourcing risks to mitigate: third-party lock-in, over-dependence, and data portability issues. - Legal and regulatory frameworks should reinforce central bank rights and powers to act decisively if a third-party operator fails and should compel the operator to design systems that are open and interoperable to facilitate transfer. ### Dual central bank role: operator and regulator/overseer of an rCBDC platform - Conflict of interest: - If a central bank operates an rCBDC platform and also regulates/oversees payment systems, governance mechanisms must address conflicts of interest and self-regulation concerns. - The central bank would be making operational decisions (technology, participant management) while also regulating and overseeing payment systems generally, which can undermine effective regulation and oversight unless effectively managed. - Perception risk: potential perceptions of unfairness if the central bank’s payment system is not held to the same standards as private systems. - Precedent: central banks already operate RTGS—and in some cases fast retail payment systems—while overseeing payment systems, highlighting the need for governance solutions to mitigate conflicts. ### Legal foundation to regulate and supervise rCBDC service providers - Regulatory regime considerations: - Regulation and supervision of rCBDC service providers should rest on a robust legal framework. - Intermediaries providing rCBDC services (for example, rCBDC wallets, rCBDC service accounts) require effective regulation and supervision. - In some jurisdictions, the central bank is not the regulator or supervisor for payment service providers. 49 - Authorities might consider assigning regulatory or supervisory roles to central banks for rCBDC, given the central bank’s system-wide perspective and vested interest in payment stability, but the overarching goal is to close regulatory gaps. *INTERNATIONAL MONETARY FUND* ### Box 3. Mitigating Conflict of Interest in Multiple Roles of a Central Bank ### Box 3. Mitigating Conflict of Interest in Multiple Roles of a Central Bank ### Inherent conflict and high-level mitigation measures - A central bank that regulates and oversees payment systems including retail ones and simultaneously operates an rCBDC payment platform faces an inherent conflict of interest. Mitigating these risks is crucial to maintain safe, efficient payment systems and public confidence in rCBDC. - Traditional mitigation measures span governance arrangements, operational structure, and external accountability: - Independent Oversight Board: - Establish a dedicated oversight board or committee for rCBDC policy with independent members. - Example: Australia formed a separate Payments System Board with a majority of external directors (Section 25A of the Reserve Bank of Australia Act). The board oversees both wholesale and retail payment systems regulation and its compliance (including the central bank’s own systems) and helps ensure decisions are made in the public interest. - Enhanced Transparency with Regular Audits: - Commit to transparent rule-making and regular audits. - Major regulatory and oversight decisions affecting retail payments (for example, standards affecting rCBDC and private retail payment systems) should undergo public consultation. - Regular audits of rCBDC operations by independent auditors can verify that the central bank meets the same standards it expects of others. - Internal Separation: - Create a clear separation between the team operating the rCBDC platform and the team regulating and overseeing payment systems with separate reporting lines to the highest levels. - Operational staff are walled off from non-public regulatory or oversight information and do not influence regulatory decisions or the conduct of oversight (the “Chinese walls”). - Periodic Public Reporting: - Require periodic public reports on rCBDC payment platform’s performance and its interactions with the wider retail payment market to force self-assessment and allow legislators and stakeholders to hold the central bank accountable to its public mandate given by law. ### Mandating participation and portability (policy choices and legal safeguards) - Mandatory Participation of rCBDC Service Providers: - Some jurisdictions consider compelling certain intermediaries—especially major banks—to participate in an rCBDC payment platform to promote universal availability and adoption. - Examples in practice: - Central Bank of Nigeria (CBN) issued Regulatory Guidelines requiring all licensed financial institutions to serve as eNaira intermediaries. - EU’s draft digital euro legislation stipulates that credit institutions already providing specific payment services would have to offer basic digital euro services to their clients on their requests. - Potential objectives: financial inclusion and payment system resilience (e.g., serving unbanked or underbanked populations with rCBDC wallets, possibly through simplified onboarding with digital ID). - Legal constraints: - Any mandatory participation requirement must be justified by public interest and designed proportionality. Forcing private firms to deliver rCBDC services might clash with freedom of enterprise and thus should occur only through well-founded laws aiming at essential public goals, with exemptions for smaller players, cost recovery, and situating obligations within the broader regulated financial system. - Power to Impose rCBDC Wallet/Service Account Portability in Exceptional Cases: - Central banks may be granted legal authority to transfer users’ rCBDC wallets or service accounts to an alternative provider if the incumbent provider is unable to maintain rCBDC services. - Two main scenarios prompting transfer: - (i) The intermediary becomes insolvent or fails. - (ii) The intermediary loses relevant user data or has a sustained outage. - Legal framework considerations: - Insolvency/resolution scenario: transfer authority may fall within insolvency or resolution regimes, with possible tailored rules empowering authorities to effectuate immediate transfers as part of resolution of critical services; prior consent from individual users may not be practical. - Data loss/outage scenario: retention of user rights and balancing public interest with private rights requires robust regulatory and contractual safeguards, including clearly defined trigger events; specified conditions such as user consent; protections of users’ rCBDC holdings and related data; and rigorous oversight and transparency mechanisms. - Example: Proposed regulation on the digital euro envisions authority for the ECB to permit transfer of digital euro payment accounts where a provider has lost necessary data, allowing a new provider to access the user’s holdings and finalize the transfer. ### Legal relationships: overview and importance - Central banks must navigate a complex web of legal relationships shaped by rCBDC designs and by the type of legal relationships between the central bank and other parties (public law or private law; standardized/enforceable regulatory terms vs. contractual arrangements). - Clear legal frameworks governing these relationships are vital to: - Reinforce users’ rights and public trust in rCBDC initiatives. - Ensure key policy objectives (for example, preserving the credit risk-free nature of rCBDC in the case of intermediary failure) are not compromised. - Central banks should identify the type of legal relationships with other actors and assess allocation of responsibilities in order to mitigate risks. Clear allocation of responsibilities should be addressed by laws (and regulation); detailed contractual arrangements may also play a role. ### Legal relationship between issuing central bank and rCBDC users - Distinction between two types of links that may create legal responsibilities for central banks: - Asset link: - rCBDC as a direct liability of the central bank creates a direct legal link with users. - Where liabilities are held on the central bank’s retail platform, central banks should assess whether platform accounts are simple identification tools or financial accounts subject to strict legal obligations. - Financial accounts may be classified as current accounts (legal obligation to promptly repay rCBDC balances upon demand) or safeguarding accounts (fiduciary duties such as duty to take all reasonable steps to prevent loss, theft or damage). - Maintaining a direct liability link in two-tier rCBDC models is crucial; law must ensure rCBDC remains a direct liability of the central bank at all times and not convert into claims against private intermediaries. - Legal classification issues: - Risk if holdings at intermediaries are characterized as traditional deposits: users’ funds could be subject to the bankruptcy of intermediaries and face delays or losses in recovery. - Remedies: clear rCBDC legal classification (with proprietary rights) and clear legal classification of users–intermediaries relationships. - Technological link: - Legal obligations may arise where rCBDC is designed as a public good requiring continuous, universal, reliable and secure technological access (especially where central banks have explicit financial inclusion objectives). - Sovereign function concerns: some jurisdictions may prohibit outsourcing currency issuance to private entities, requiring central banks to keep a minimum degree of legal and operational control—and thus corresponding legal responsibility—over technological services for issuance and the “burning” of rCBDC. - Contractual arrangements: user agreements (for example, acceptance of terms when downloading an rCBDC application) can create direct contractual relationships; terms typically outline services, disclaim warranties, and specify responsibilities. Clauses limiting warranties or liabilities or allowing unilateral amendment should be designed carefully to avoid undermining public policy goals like equivalence to cash or reputational harm. ### Legal relationship between issuing central bank and intermediaries - Multifaceted relationships arise from roles intermediaries play: facilitating rCBDC payment transactions and acting as participants in the rCBDC payment platform; these relationships may stem from law/regulation or contracts. - Legal Relationship as Regulated rCBDC Service Providers: - Intermediaries offering rCBDC services are likely to fall under the remit of existing legal payment regimes in most current rCBDC designs. - Authorities should review key legal payment concepts (for example, “transfer” and “funds/money”) to determine whether rCBDC services fall under payment law. - Four primary regulatory adaptation areas: - Regulatory remit over rCBDC service providers as payment facilitators: - Some regimes distinguish providers handling funds directly from facilitators who do not; authorities should assess whether rCBDC service providers could be treated as facilitators if they refrain from handling rCBDC holdings. - New licensing regime for rCBDC service providers: - Many designs propose multiple types of rCBDC services (access, liquidity, transaction management) that may require several types of licenses; some authorities consider a special license for non-bank firms. - Regulatory adaptation to novel services and risks: - Novel functionalities (programmability, offline functionalities) and data portability enabling transfers in exceptional cases may require updated regulatory safeguards. - Challenges in regulating providers with other core activities: - Providers that top off non-payment businesses (for example, Big Tech integrating rCBDC with e-commerce) require robust regulation and supervision, possibly consolidated supervision powers and collaboration with other authorities to monitor risks and protect the central bank’s reputation. - Legal Relationship as Participants in the rCBDC Payment Platforms: - Where the rCBDC platform is classified as a payment system, intermediaries must adhere to contractual terms or rulebooks covering operation, compliance, allocation of liability, participant management, cost allocation, data sharing and technology requirements, dispute resolution mechanisms, and other standards. - Rulebooks may be issued through regulations; to enable users to enforce rights in rulebooks, the rulebooks may need to be a public law instrument granting sanctioning powers to a public authority. - Rulebooks should clarify whether and how users can pursue legal action for rulebook breaches. ### Legal relationship between intermediaries and rCBDC users - Where rCBDC services are classified as regulated services, user–intermediary relationships will primarily be governed by payment laws, limiting intermediaries’ flexibility to customize terms and enabling supervisors to enforce user rights through fines or penalties. - Key legal design priorities to maintain rCBDC’s credit risk-free nature: - Ring-fence users’ holdings from intermediaries’ estates: - Legal classification should give users propriety rights over rCBDC and avoid equating intermediary services to rCBDC “deposits” that convert legal title into claims against intermediaries. - Legal mechanisms to preserve legal title: safekeeping, custody, or trust. - Ensure enforceable contingency mechanisms for user access if intermediaries fail: - Power for issuing central bank to intercept and access intermediaries’ systems or enable seamless wallet and data transfer through data portability provisions to alternative rCBDC service providers. - Clarity on indemnification and liability allocation: - Users’ recourse for damages depends on whether failures arise from central bank control, intermediary control, or both: - If damages arise solely from central bank-controlled failures (for example, system wide technical failure of central bank core ledger), users cannot claim indemnification from intermediaries unless explicitly provided in law or regulation. - Intermediaries might still be liable for inadequate contingency measures. - Where failures arise from both central bank and intermediary control, clear allocation of responsibilities and procedural mechanisms for indemnification recovery must be established. - Agency relationships and control considerations: liability assessments should factor in whether intermediaries act on behalf of the central bank and whether financial consideration in relationships is balanced. *International Monetary Fund — FINTECH NOTES Selected Legal Considerations for Central Bank Digital Currencies* ### Box 4. General Legal Principles Applicable to Both Central Bank–Users and ### Box 4. General Legal Principles Applicable to Both Central Bank–Users and Central Bank–Intermediaries Relationships ### Fundamental legal principles applicable to rCBDC - rCBDC, as public goods, should be designed to respect fundamental rights principles. - Specific principles and examples: - Non-discrimination: Authorities cannot introduce measures that arbitrarily disadvantage certain groups. - Proportionality: Any restrictions imposed through monetary policy or financial regulations must serve legitimate public interests and be proportionate to the related public policy objectives. - Access to justice: If the authorities’ actions (for example, freezing an rCBDC wallet) affect individuals, those affected must have legal remedies. - Property rights: For the legal regimes that classify property rights as fundamental rights, authorities must obtain users’ consent prior to any actions that could infringe on their property rights (for example, requiring rCBDC users in a pilot to accept that their rCBDC holdings will be burnt at pilot’s conclusion). ### Immunities, legal protection, and agency principles - Immunities and legal protection: - In many jurisdictions, when a central bank acts as a public authority pursuing its mandate, they benefit from certain immunities and legal protection. - Central banks could be protected from lawsuits for acts or omissions performed pursuant to and in the course of their public duties (unless proven intentional wrongful conduct or gross negligence). - Agency and responsibility: - Common general legal principles, like agency, may be relevant. - Under agency principles, a principal is ultimately responsible for its agents’ actions taken within the scope of their authority. - Even if central banks outsource some functions to private entities, central banks might remain ultimately responsible for their actions. ### Legal risks when contractual relationships are excluded - Excluding an explicit contractual relationship between the central bank and users does not necessarily eliminate all legal risks to the central bank. - Possible bases for central bank responsibility even absent contract: - General principles of non-contractual liability (for example, tort). - Specific laws (for example, general administrative law). - Relevance given operational and third-party risks: - High operational risks: technical failures, cyber risks, data breaches. - Third-party risks: technology provider’s failures. - Implication: central banks may be required to provide remedies to users harmed by the use of rCBDC because of their actions or omissions. ### Illustrative pilot example - In a pilot, the Eastern Caribbean Central Bank (ECCB) had to go offline for a month in 2021, and the central bank’s website had noted that the “ECCB guarantees all funds on the Dcash network against losses due to infrastructure failure for the duration of the pilot.” ### Limits on rCBDC under the Lens of Law (selected points) - Jurisdictions may consider imposing justified and proportionate limits on rCBDC usage and fees for rCBDC services through laws or regulations that cap rCBDC holding amounts, transaction sizes, and rCBDC transaction fees. - Limits on the aspect of store of value: rCBDC holding amount - Purpose: mitigate financial disintermediation risks and preserve financial and monetary stability by preventing large-scale deposit outflows from commercial banks. - Legal grounding: limits on rCBDC holdings must be clearly grounded in law. - Mechanisms and concerns: - “Waterfall mechanism” proposals to automatically redirect excess rCBDC balances to commercial bank accounts may raise property rights concerns as they convert central bank money into risk-bearing commercial bank deposits. - Legal frameworks must ensure transparency, proportionality, and user consent when such mechanisms are used. - Jurisdictional approaches (examples preserved exactly as presented): - Bank of England proposes a £10,000–£20,000 cap during the digital pound’s rollout. - China applies tiered limits based on user identification levels. - Nigeria’s eNaira imposes wallet limits ranging from 120,000 to 5,000,000 Naira for individuals, with no cap for merchants. - Authority to set limits: - The authority to set specific rCBDC holding limits should be vested primarily in the central bank, possibly in coordination with the government, to balance central bank’s autonomy with the broader mandate of financial stability. - Codifying limits into law could impinge on central bank functional autonomy because statutory provisions may lack adaptability. - Delegating authority primarily to the central bank—with clear accountability mechanisms—may be warranted, while recognizing that close coordination with the government remains key depending on legal and institutional frameworks. - Limits on the aspect of means of exchange: rCBDC transaction amount - Transaction limits serve operational and policy purposes and must be based on a clear legal foundation. - Operational rationale: caps on transaction amounts can prevent demand spikes that could overwhelm infrastructure. - Financial stability rationale: caps can act as a safeguard against large and abrupt capital outflows or sudden shifts from commercial bank deposits into rCBDC, especially during periods of market stress. - Legal requirement: if the central bank is to wield this power, it must be legally authorized. *International Monetary Fund — FINTECH NOTES: Selected Legal Considerations for Central Bank Digital Currencies* ### Section 10.4 of the Regulatory Guidelines on eNaira 2021. ### Section 10.4 of the Regulatory Guidelines on eNaira 2021 ### Transaction limits and limits on fees for rCBDC services - Article 18 paragraph 17 point 18 of the Federal Law No. 86-FZ of July 10, 2002, “On the Central Bank of the Russian Federation (Bank of Russia)” states that the Bank of Russia determines the maximum amounts of transactions with digital rubles. - Limits on fees for rCBDC services support attributes like legal tender status and require a clear legal basis. - Fee caps should be justified (including cost-linked issues) and proportionate; unjustified caps risk being seen as an unlawful reduction of face value. - Fee limits help rCBDC act as public money and incentivize use and trust. - Example: Draft EU digital euro regulation aims to ensure free basic digital euro services for euro area residents (including certain former residents and visitors) in line with its legal tender status. - Note: In some jurisdictions, financial regulators may lack power to regulate fees charged by payment service providers unless explicitly empowered by law. - Two legal dimensions: - From providers’ perspective: giving central banks authority to cap fees must consider free market principles. - From users’ perspective: Constitutions in some jurisdictions guarantee the right to be financially included to basic financial services, making fee caps on basic rCBDC services easier to justify than on more advanced services. ### Interest-bearing rCBDC - Allowing rCBDC to bear interest could have financial and monetary stability implications and must be consistent with other rCBDC desirable attributes. - Remuneration of rCBDC should be analyzed in conjunction with features like legal tender, cours forcé, and convertibility. - In the majority of rCBDC projects, rCBDC is non-remunerated. - Examples: - Bank of England envisions the digital pound like a digital banknote, with zero interest. - Russian law explicitly prohibits accruing interest on digital ruble balances (National Payment System Law, Article 30.8(4)). - China’s e-CNY does not pay interest, nor does India’s retail digital rupee (e₹-R). - Some central banks (for example, the Bank of Israel) consider the possibility of designing its CBDC as an interest-bearing instrument. - Note: Purely theoretically, rCBDC could be a monetary policy instrument to affect monetary transmission (see Das and others (2023) as referenced). ### Programmability: programmable money vs programmable payments - Programmable money = digital money encoded with conditions on its use (for example, restricted to buying certain goods, or carrying an expiration date). - Most authorities have stated they will not make rCBDC programmable in this restrictive way. - Key legal and policy concerns if rCBDC is programmable: - May conflict with legal characterization as currency with legal tender and convertibility. - Could violate fundamental private rights (for example, property rights) and reduce user autonomy. - Setting expiration dates risks claims of expropriation if done without due process. - Programming limits on who can hold or receive rCBDC could hinder market participation, contractual freedom, and risk discrimination if not proportionate and transparent. - If a jurisdiction opts for programmable rCBDC, explicit legal authorization and safeguards (to protect users and ensure transparency) would be required. - Distinction: programmable payments (conditional payments initiated by the rCBDC user) do not alter the nature of the currency itself and already have analogues in banking (for example, standing orders, recurring payments, spending limits). - Programmable payments could spur rCBDC adoption by enabling automatic transfers when conditions are met. - Legal updates likely needed to accommodate smart contracts and clarify: - Whether agreements formed through smart contracts are legally binding. - How to interpret or enforce contract terms executed by code. - Regulators should assess regulatory risks introduced by programmable payments and ensure clear regulatory powers to mitigate financial stability and consumer protection concerns. - Standardization and interoperability are important for successful programmable features. - Liability allocation must be clarified where users incur losses from programmable features (for example, malfunctions or malicious exploits). - Note: Some rCBDC designs may not involve the central bank directly offering programmability; intermediaries may provide such features and contractual allocation of responsibility must be clear. ### Offline rCBDC transactions: legal design considerations - Offline rCBDC transactions: transfers of value between devices that occur without connecting to any ledger system (as discussed in IMF Fintech Note on offline rCBDC transactions (Tourpe and others 2025) and BIS reports). - Solutions include peer-to-peer or point-of-sale transfers using devices like smart phones or battery-powered smart cards. - Policy objectives served: enhancing payment system resilience and promoting financial inclusion. - Legal clarity needed on when settlement finality occurs for offline rCBDC transactions. - Settlement finality defined as the irrevocable and unconditional transfer of an asset or discharge of an obligation in accordance with the terms of an underlying contract (CPSS and IOSCO 2012). - Whether rCBDC payment platforms require the same level of settlement finality protection as interbank settlement systems depends on the risks and relates to both online and offline transactions. - Offline transactions introduce additional settlement concerns (for example, in case of payer insolvency) due to potential lag between transaction and reconciliation with the core CBDC ledger. - BIS offline modes referenced: - Fully offline: exchanged value can be spent again immediately and indefinitely; no requirement to reconnect. - Intermittently offline: similar to fully offline but requires reconnection before further transactions; risk management limits. - Staged offline: value cannot be spent again until the payee reconnects online. - Legal solutions and examples: - Draft digital euro regulation proposal: law explicitly provides that final settlement occurs at the moment of updating the records of relevant digital euro holdings in the local storage devices of, respectively, the payer and the payee, irrespective of recording format or technology used. - Legal provisions may be needed to maintain the singleness of money for offline rCBDC: - Law might explicitly state both offline and online rCBDC have legal tender status. - Law might allow payees to refuse an offline rCBDC payment in good faith for reasons beyond their control (for example, malfunctioning device). - Guarantee of full convertibility at par between offline and online rCBDC could be provided by law. - Clear compensation and liability rules are needed for losses related to offline rCBDC use: - Risks include loss/theft of offline device leading to loss of stored rCBDC, and inability of intermediaries to block or monitor offline transactions in real time. - Jurisdictions should assess whether specific compensation rules are necessary or if general rules suffice. - Roles and liabilities (for example, who is liable for double-spending) must be defined. - Intermediaries should be obliged to disclose offline-device loss/theft risks to users. - Cybercrime and fraud risks require prudence and possibly adapting counterfeiting laws to this new risk. - Legal certainty about validity and perfection of transfer of ownership rights in offline rCBDC transactions is required: - Law should be clear that an offline transaction can legally occur and be perfected. - Clarification needed on roles of offline rCBDC wallets and any transaction registries. - Legislators may need to address the application of the “good faith purchaser” rule if an offline wallet device is lost or stolen (for example, whether someone who unknowingly receives stolen offline rCBDC could obtain good title). ### Selected legal aspects of wCBDC: definition and scope - Definition used in this Note: wCBDC refers to a tokenized form of central bank money accessible only to a predefined entity group, typically financial institutions. - Focus: wCBDC designed to facilitate payments (money and settlement asset) where issuing and operating wCBDC is not expected to economically change the central bank balance sheet and wCBDC is intended to be fully fungible with reserves held at the central bank. - wCBDC might be treated economically the same as reserves (for example, remunerated similarly, qualify as high-quality liquid assets, accounted for like reserves). - Distinction highlighted: - wCBDC not legally classified as current account deposits. - Tokenized current account deposits legally identical to existing current account deposits (not requiring amendments/new interpretations). ### Legal aspects and risks for wCBDC - Legal certainty over the nature and validity of token operations is essential: - Tokenization creates digital representations of assets; legal intervention is essential to ensure tokens align with underlying assets. - Common model: linking tokens to financial institutions’ accounts in the RTGS system, where wCBDC tokens represent contractual rights mediated through RTGS accounts. - Key legal risk: desynchronization between token ledgers and RTGS systems, potentially enabling double spending or circulation of unbacked tokens. - Legal frameworks must ensure real-time reconciliation and enforceable backing mechanisms. - Law should address transfer rules (including loss, illegal transfers, good-faith acquisition) and effects of counterparty insolvency. - Jurisdictions should consider whether to give wCBDC currency status or rely on contractual arrangements. - Mandate of the central bank to issue wCBDC—legal questions to explore: - Issuance of central bank liabilities: - Central bank laws typically authorize currency (physical banknotes and coins) and balances (reserves) in accounts at the central bank. - Each jurisdiction should determine if wCBDC issuance is legally allowed. - If wCBDC is functionally equivalent to reserves, existing authority might suffice; if wCBDC is a new type of liability, current powers might not allow such issuance, creating ultra vires risk. - Classification depends on legal traditions, private law classification of property, and accounting treatment. - Where law does not grant requisite competence, legislative changes are a precondition. - Opening of accounts at the central bank: - Jurisdictions should check whether existing legal provisions suffice for issuing wCBDC; legal reform may be needed to allow token form recorded separately on the balance sheet. - Payment system mandate: - Depending on design and interpretation, mandate to promote efficient payment systems might or might not allow establishing a wCBDC platform; central bank and payments law should clearly permit a wCBDC system to avoid legal and reputational risk. - Extended access: - If access is extended to non-bank institutions not currently eligible for central bank accounts, legal reforms and accompanying regulation/supervision of those entities may be required. - Central bank operation and control of the wCBDC platform: - If designated as systemically important, PFMI standards apply (for example, PFMI Principle 1 requires a well-founded, clear, and enforceable legal framework for all material activities of an FMI). - Central bank should have statutory authority to own and operate a wCBDC platform; outsourcing requires legal permission and retained control. - Outsourcing to third parties is possible in some jurisdictions (example given: Switzerland and Project Helvetia under Swiss law). - Where outsourcing occurs, central bank must retain control and oversight via technical and contractual means (powers to require changes, suspend participants, block transactions if suspicious). - Law should address central bank responsibility for potential losses when exercising such control. - Legal relationship between central bank and wCBDC users: - Asset link: possible parallel relationships: - Reserves relationship: tokenized central bank reserves with an account on central bank books; account holder has at minimum a monetary claim against the central bank for repayment. - Token relationship: separate relationship concerning the token that represents the reserves; legal classification determines obligations of the central bank to wCBDC users (evidence of reserves vs property of its own; recordkeeping vs safekeeping). - Contractual arrangements could govern user rights but may be insufficient under existing legal rules on finality and insolvency; legal reform may be needed to address reconciliation gaps and insolvency scenarios. - Technological link: governance of technological services (platform access, operation, maintenance) may require legal reform and contractual arrangements: - Nature of the relationship could mirror rCBDC arrangements (contractual rulebooks; potential central bank liability under general rules). - Third-party platforms: central bank might use third-party front-ends, limiting central bank technological responsibilities to maintaining integrity of its internal system linked to the third party. - Legal reform could be necessary to allow issuance on privately-operated platforms. *Section 10.4 of the Regulatory Guidelines on eNaira 2021.* ### Section VI). It should be noted that if the third party operates the platform on the central bank’s ### ftnea2025006 - Section VI). It should be noted that if the third party operates the platform on the central bank’s ### Settlement Finality for wCBDC - Legal frameworks should recognize settlement finality for wCBDC transactions. - Settlement finality is achieved when the settlement of an obligation becomes legally irrevocable and unconditional. - Jurisdictions should make sure that solutions considered for various challenges can be implemented by legal reforms unless contractually possible: - Finality of transfer: A significant legal issue for wCBDCs is determining when a token transfer is considered final under the law—identifying the single finality moment of transfer of wCBDC units, from the transferor to the transferee. - Impact of insolvency regimes: Insolvency laws might affect the finality of wCBDC transfers already perfected, for instance, for prevention of fraud purposes. The main question is whether a wCBDC platform would get protection under the existing settlement finality laws. - Consensus mechanisms: Legal complexities may appear around identifying the exact moment of the transfer in some system designs. For wCBDC designs with probabilistic settlement, finality could be defined as after a certain percentage of validators confirm a transaction or several blocks are added to the chain. - Reference in text: 91 ### Conclusion — Principal Legal Findings and Implications (rCBDC and wCBDC) - Purpose: Assist policymakers in identifying and addressing key legal issues relevant to the issuance of CBDCs, with primary focus on rCBDC and separate analysis of wCBDC. - Scope: Builds on prior IMF legal work and draws from enacted laws, regulations, and public drafts to support jurisdictions in evaluating the adequacy of their legal frameworks. - rCBDC legal nature and implications: - rCBDC is a central bank liability—a new form of central bank money that is credit risk-free compared with privately issued instruments. - rCBDC’s availability to the general public distinguishes it from other digital central bank liabilities; many jurisdictions could view rCBDC as “digital cash,” granting it currency status. - Currency status implications: exclusive issuance right for the monetary authority; rCBDC payments honor face (nominal) value; 1:1 convertibility with other central bank money and with commercial bank money to support the singleness of money. - Jurisdictions can extend administrative and criminal protections to rCBDC’s issuance monopoly and legal tender status, and penalize rCBDC cybercrime and fraud. - Legal mandate and platform operations for rCBDC: - Clear central bank authority to issue rCBDC and legally sound, well-regulated rCBDC payment platforms and intermediaries are required. - An explicit statutory mandate for rCBDC issuance reduces legal risks; central bank laws often need updating to confirm issuance authority. - Preference observed for two-tier models (public–private partnership) over direct public accounts at central banks. - Legal reforms may be needed to affirm central banks’ authority to own/operate rCBDC payment platforms if not already within their remit. - When platform operations are outsourced, the central bank must retain full control legally and contractually. - If central bank–operated rCBDC payment platform is systemically important, it should align with PFMI standards; governance must address conflicts of interest (self-regulation) concerns. - The central bank’s mandate might extend to providing front-end rCBDC access tools (software/hardware); these require clear legal authorization. - A comprehensive legal framework is needed to license, regulate, and supervise intermediaries offering rCBDC services such as wallets and service accounts. - Authorities should carefully consider empowering rCBDC wallet or service account portability in exceptional cases, with appropriate safeguards. - Legal relationships in an rCBDC landscape — three types to assess: - Central bank–users: - “Asset link”: link between users and central bank revolving around rCBDC being a monetary instrument. - “Technological link”: relates to technological service the central bank provides to users to allow access and use of rCBDC. - Central bank–intermediaries: - Intermediaries as regulated payment service providers likely fall under existing payment regimes but updates may be needed. - Intermediaries as participants in the rCBDC platform may be subject to standardized terms and conditions taking the form of a rulebook. - Intermediaries–users: - Offering of rCBDC services can be classified as regulated payment services; relationship primarily based on law and complemented by contracts. - rCBDC specifications and functionalities requiring legal grounding: - Limits on holding and transaction amounts, fees, interest accrual, programmability, and offline payments must be grounded in law. - Majority of current rCBDC projects envisage no interest on rCBDC. - Programmable (conditional) payments are novel in publicly available central bank money and raise legal challenges. - Offline payments can support payment resilience and financial inclusion but require a sound legal foundation. - wCBDC legal aspects summarized: - wCBDC defined here as a tokenized form of central bank money accessible only to selected financial institutions. - Central bank–user (institution) relationship raises asset link and technological link issues. - Central bank mandate must clearly cover issuing wCBDC and operating (or outsourcing) its platform while maintaining control. - Laws must address legal rules for token transfers (including loss, illegal transfers, good-faith acquisition) and the precise moment when wCBDC settlement is irrevocable and final. ### Annex: Key Legal Considerations with Practical Approaches (Selected entries) - The Legal Nature of rCBDC in Public Law (items 1–3) - 1 rCBDC: a digital form of central bank money available to the general public — jurisdictions should qualify rCBDC as a liability of the central bank in their legal frameworks. Examples: Bank of Jamaica Act 2022; Regulatory Guidelines on the eNaira 2021; Reserve Bank of India Act, 1934 (as amended). - 2 rCBDC: intermediary insolvency remote — rCBDC should remain a central bank liability in any architecture; users should be legally protected from intermediary insolvency. Example: China’s e-CNY two-tier architecture. - 3 rCBDC: currency status — law should recognize rCBDC as currency where intended to be digital cash. Examples: Bank of Jamaica Act 2022 (monopoly of issuance); EU draft digital euro regulation (cours forcé); Ukraine amendment (legal tender); Bahamas’ Central Bank Act 2020 (criminalizes counterfeiting of electronic money designated as legal tender). - Retail CBDC implications on central bank mandate (items 4–10) - 4 Legal mandate to issue rCBDC — jurisdictions should consider vesting issuance function in the central bank via clear statutory language; launches of certain pilots might require legal amendments. Examples: Bank of Jamaica Act 2022; ECCB Agreement amendment for “DCash” pilot. - 5 Authority to own and operate an rCBDC platform — central banks should have statutory authority to own and operate rCBDC payment platforms and front-end involvement. Examples: Law of the People’s Republic of China on the PBOC; Central Bank of Malaysia Act; draft digital euro regulation recognizing front-end public options. - 6 PFMI standards for an rCBDC platform — if designated systemically important, review compliance with PFMI principles (Principle 1, Principle 8, Principle 2, Principle 17 noted). - 7 Outsourcing of rCBDC platform operations — when outsourced, ensure legal permissibility and central bank retains full control through legal and contractual arrangements; require compliance with security standards, audit access, business continuity, and legal/regulatory authority to intervene. - 8 Dual roles as operator and regulator — governance mechanisms to address conflicts of interest: independent oversight board/committee, transparency, internal separation, periodic public reporting. - 9 Regulation/supervision of rCBDC intermediaries — intermediaries should be regulated under a sound legal framework; mandatory participation requirements must be proportionate and serve public interest. Examples: BDDC Regulations, 2021; draft digital euro regulation; Central Bank of Nigeria Regulatory Guidelines. - 10 rCBDC wallet/service account portability in exceptional cases — legal authority should exist to transfer users’ rCBDC wallets/accounts to alternative providers in exceptional circumstances. Example: draft digital euro regulation provision for transfers when a provider loses essential account data. - Legal relationships in rCBDC landscape (items 11–15) - 11 Clarification of relationships — legal characterization of relationships influences central bank responsibilities and risk exposure; clear framework enhances enforceability and public confidence. - 12 Central bank–users relationship — obligations from Asset and Technological Links must be clearly articulated in law and, where applicable, in user agreements. - 13 Central bank–intermediaries relationship — update existing payment laws to explicitly cover rCBDC service providers and platform participants; clarify supervisory mandates and establish enforceable platform rulebooks. - 14 Intermediaries–users relationship — users’ holdings must be protected and legally distinct from intermediaries’ assets; ring-fencing, contingency access (e.g., wallet portability), and allocation of liability/indemnification procedures required. - 15 Applicable general legal principles — align with non-discrimination, proportionality, access to justice, protection of property rights; clarify scope of central bank immunities and liabilities; agency principles may apply when functions are outsourced. - Specific rCBDC functionalities (items 16–18) - 16 Limits on holdings/transactions and fee caps — ensure clear legal basis for setting limits and fee limitations. Examples: draft digital euro regulation (holding limit); Russia central bank law (transaction limit); limits on inter-PSP or merchant fees to preserve use as legal tender. - 17 rCBDC programmability — assess legal implications of programmable payments; revise legal frameworks for smart contracts, clarify legal status, supervise programmable payment services, and delineate liability for technical failures or misuse. - 18 rCBDC offline functionality — legal framework should address settlement finality, legal tender status, convertibility, compensation rules, and validity of ownership transfers; confirm offline and online rCBDC constitute legal tender and ensure convertibility at par. - Selected wCBDC aspects (items 19–22) - 19 Legal mandate to issue wCBDC — ensure sound and robust legal basis for issuance of wCBDC (tokenized central bank reserves); determine whether existing legal authority suffices or legislative reform is required to avoid ultra vires risk. - 20 wCBDC: a tokenized form of central bank reserves — assess need for legal reforms to ensure legal certainty in token operations; address rules for transferring tokens, effects of counterparty insolvency, and establish robust legal links between tokens and underlying assets. - 21 Operation/outsource of wCBDC platforms — central bank powers to own and operate or outsource may require legal reforms; where outsourced, central bank must retain control; example reference to Switzerland allowing issuance through platforms operated by private entities (Project Helvetia under Swiss law). - 22 wCBDC: settlement finality — legal frameworks should explicitly recognize settlement finality for wCBDC transactions; specify exactly when ownership transfers, taking insolvency laws into account; in probabilistic systems finality may hinge on validator confirmations or new ledger blocks; jurisdictions should ensure legal enforceability of solutions. *International Monetary Fund — FINTECH NOTES Selected Legal Considerations for Central Bank Digital Currencies (ftnea2025006)* ### References ### References ### Multilateral bodies, standards, and cross-jurisdictional reports - Bank of Canada, Swiss National Bank, European Central Bank, Bank of England, Bank of Japan, Board of Governors of the Federal Reserve System, Sveriges Riksbank, and Bank for International Settlements. 2024. “Legal aspects of retail CBDCs.” Bank for International Settlements, Basel, November. - BIS Innovation Hub. 2023a. “Project Polaris—Part 1: A handbook for offline payments with CBDC.” Bank for International Settlements, Basel, May. - BIS Innovation Hub. 2023b. “Project Polaris—Part 4: A high-level design guide for offline payments with CBDC.” Bank for International Settlements, Basel, October. - Committee on Payments and Market Infrastructures (CPMI) and International Organization of Securities Commissions (IOSCO). 2015. “Application of the Principles for financial market infrastructures to central bank FMIs.” Bank for International Settlements, Basel, August. - Committee on Payments and Market Infrastructures (CPMI) and International Organization of Securities Commissions (IOSCO). 2022. “Application of the Principles for Financial Market Infrastructures to stablecoin arrangements.” Bank for International Settlements, Basel, July. - Committee on Payment and Settlement Systems (CPSS) and International Organization of Securities Commissions (IOSCO). 2012. “Principles for financial market infrastructures.” Bank for International Settlements, Basel, April. - International Institute for the Unification of Private Law (UNIDROIT). 2023. “UNIDROIT Principles on Digital Assets and Private Law.” UNIDROIT, Rome. ### Central bank reports and design papers - Bank of England. 2020. “Central Bank Digital Currency: Opportunities, challenges and design.” Discussion Paper, Bank of England, London, March. - Bank of England. 2025. “Digital pound experiment report: Offline payments.” Bank of England, London, April. - Bank of England and HM Treasury. 2024. “Response to the Bank of England and HM Treasury Consultation Paper: The digital pound: a new form of money for households and businesses?” Bank of England and HM Treasury, London, January. - Bank of Ghana. 2022. “Design paper of the digital Cedi (eCedi).” Bank of Ghana, Accra, March. - Bank of Israel. 2025. “Preliminary Design for the Digital Shekel System.” Bank of Israel, Jerusalem, March. - European Central Bank. 2020. “Report on a digital euro.” European Central Bank, Frankfurt, October. - European Central Bank. 2024. “Update on the work of the digital euro scheme’s Rulebook Development Group.” European Central Bank, Frankfurt, January. - Relevant Ministries and the Bank of Japan Liaison Meeting on Central Bank Digital Currency (CBDC). 2024. “Interim Report.” Relevant Ministries and the Bank of Japan Liaison Meeting on CBDC, Tokyo, April. - Minwalla, Cyrus, John Miedema, Sebastian Hernandez, and Alexandra Sutton-Lalani. 2023. “A Central Bank Digital Currency for Offline Payments.” Staff Analytical Note 2023-2, Bank of Canada, Ottawa, February. ### IMF Fintech Notes, Working Papers, and analytical notes - Bains, Parma, Nobuyasu Sugimoto, and Christopher Wilson. 2022. “BigTech in Financial Services: Regulatory Approaches and Architecture.” IMF Fintech Note 2022/002, International Monetary Fund, Washington, DC. - Bechara, Marianne, Wouter Bossu, Yan Liu, and Arthur Rossi. 2021. “The Impact of Fintech on Central Bank Governance: Key Legal Issues.” IMF Fintech Note 2021/001, International Monetary Fund, Washington, DC. - Bechara, Marianne, Wouter Bossu, Amira Rasekh, Chia Yi Tan, and Akihiro Yoshinaga. 2025. “Private Law Aspects of Token-Based Central Bank Digital Currencies.” IMF Fintech Note 2025/003, International Monetary Fund, Washington, DC. - Bossu, Wouter, Masaru Itatani, Catalina Margulis, Arthur Rossi, Hans Weenink, and Akihiro Yoshinaga. 2020. “Legal Aspects of Central Bank Digital Currency: Central Bank and Monetary Law Considerations.” IMF Working Paper 20/254, International Monetary Fund, Washington, DC. - Das, Mitali, Tommaso Mancini-Griffoli, Fumitaka Nakamura, Julia Otten, Gabriel Söderberg, Juan Sole, and Brandon Tan. 2023. “Implications of Central Bank Digital Currencies for Monetary Policy Transmission.” IMF Fintech Note 2023/010, International Monetary Fund, Washington, DC. - Garrido, José M. 2023. “Digital Tokens: A Legal Perspective.” IMF Working Paper 23/151, International Monetary Fund, Washington, DC. - Murphy, Kieran, Tao Sun, Yong Sarah Zhou, Natsuki Tsuda, Nicolas Zhang, Victor Budau, Frankosiligi Solomon, Kathleen Kao, Morana Vucinic, and Kristina Miggiani. 2024. “Central Bank Digital Currency Data Use and Privacy Protection.” IMF Fintech Note 2024/004, International Monetary Fund, Washington, DC. - Tourpe, Herve, John Kiff, Majid Malaika, and Chris Ostrowski. 2025. “Technology Solutions to Support Central Bank Digital Currency with Limited Connectivity: Review of Existing Approaches.” IMF Fintech Note 2025/005, International Monetary Fund, Washington, DC. *Selected Legal Considerations for Central Bank Digital Currencies NOTE/2025/006* --- _Source: https://www.imf.org/-/media/files/publications/ftn063/2025/english/ftnea2025006.pdf_