Many countries have been looking to launch CBDCs. According to data from Crowdsourcingweek, as many as 105 countries have shown interest in these central bank digital currencies.

Of these countries, the Bahamas, Nigeria, the Caribbean, China, and Jamaica have launched CBDCs. In addition, other countries, such as Ghana, South Africa, United Arab Emirates, Thailand, Malaysia, Singapore, etc., have launched their own as a pilot test.

But amid interest in these CBDCs, former Bank of England adviser Tony Yates says the project is not worth the money. According to Yates, the risks and costs of implementing digital currencies are much higher than its benefits. The adviser shared his opinion in a Financial Times op-ed.

Remember that the Bank of England is among the central banks planning a CBDC launch. But Yates is against such a move.

Yates shows skepticism about cryptocurrencies and CBDCs

Until now, Yates has not been a fan of cryptocurrencies. Therefore, he believes that cryptocurrencies are not the best candidates to serve as money.

According to him, coins are very time consuming and expensive to trade. Furthermore, cryptocurrencies do not have money supplies that humans manage to ensure a constant stream of inflation. Specifically, the advisor notes the use of BTC as speculative and illicit.

But according to a report by CipherTrace, illicit crypto transactions and activities have decreased since 2022. According to the blockchain forensics firm, the figure for 2020 was 0.62-0.65%. But in 2021, the figure fell to 0.10-0.15%.

Image: Cointelegram

The above report shows that the use of BTC in illicit activities has dropped dramatically. Also, being a public ledger, everyone can access it, which reduces loopholes for illegal activities.

In addition, its Layer-2 Lightening Network makes remittance payments faster than before, negating Yates’ view of time-consuming crypto transactions. Additionally, more crypto and stablecoin use cases have emerged over the years showing increased acceptance and adoption.

As for CBDCs, Yates questions the reason for their global rollout, as data shows that many countries have already created digital versions of notes, cash, and coins. On that, Yates is of the opinion that the coins could be a way to override cryptocurrencies, including Bitcoin.

However, he noted that the launch of CBDC will make central bank reserves widely accessible to many other than counterparties. Furthermore, Yates argues that employing staff just to build and manage the software and hardware for CBDCs will be a daunting task for central banks.

Some CBDC experiences so far

While Tony Yates advises against the Bank of England launching CBDCs, other central banks have tested the waters. Some of the results are good, as in the case of China registering more transactions in CBDC. But others are daunting, leading to a more cautious approach to adoption. For example, Nigeria registered slow adoption in its CBDC launch, the eNaira.

But, according to an 83-page document published by the Central Bank of Nigeria by 2025, the country’s central bank aims to explore the adoption of blockchain technology to power its CBDCs. Furthermore, it is considering the potential of stablecoins and how to run its ICOs over the next two years until 2025.

Former Bank of England advisers claim CBDCs are not worth the risk
The cryptocurrency market rises on the chart | Source: Crypto Total Market Cap at

Another report shows that Tanzania is now cautious about adopting CBDC after its initial investigation. The Bank of Tanzania published a notice on January 14 about its investigation and findings so far, but did not indicate when it will decide to release it. Meanwhile, the country has banned the use of cryptocurrencies since 2019.