Creating a Central Bank Digital Currency: a Public-Private Partnership and a Complement to Cash

The introduction of a central bank digital currency (CBDC), a retail currency for individuals and a “wholesale” one for interbank transactions, raises the question of the turmoil that this new form of central bank money could bring to the payment ecosystem. Using the example of the Eurosystem's “retail” digital euro project, the article shows that the traditional currency model, with its two-tiered architecture – central bank money (cash and commercial bank deposits at the central bank) and commercial bank money – has been preserved. Thanks to an appropriate division of labor and mechanisms for its implementation, this new form of central bank money will be complementary to other forms of money. As for the introduction of a “wholesale” CBDC, its job is to continue to provide the most secure settlement asset within the framework of tokenized finance.