When a group of companies headed by Facebook launched the idea of creating their own currency in 2019, which was then called Libra but later changed name to Diem, central banks around the world took note. With Facebook’s global network, this type of currency could spread rapidly and affect the central banks’ capacity to conduct monetary policy and safeguard financial stability and a safe payment system.
Then came the pandemic and cash was increasingly abandoned in favour of cards and digital payments, even in countries where cash had previously had a relatively strong position. This meant that an increasing number of countries began to consider the effects of a cashless future and the need for central bank digital currencies. Moreover, the price of various crypto currencies soared to historical levels during the pandemic, which increased the need to consider the relationship between private and public money.