Selected Legal Considerations for Central Bank Digital Currencies

This Note explores selected legal considerations for both retail CBDC (rCBDC) and wholesale CBDC (wCBDC), drawing on examples from enacted laws, regulations, and public drafts. First, with respect to rCBDC, this Note discusses the mechanisms through which rCBDC is sanctioned as a currency; the legal basis for its issuance and provision of a payment platform; and the central bank’s mandate to regulate rCBDC service providers. It examines the nature and impact of legal relationships in the rCBDC landscape, among others, aiming to help central banks better assess potential legal risks. The analysis also considers specific rCBDC design features, including holding and transaction limits, fee caps, interest accrual, programmability, and offline capabilities. Subsequently, this Note addresses wCBDC-specific legal considerations such as the legal nature of wCBDC; the central bank’s mandate to issue wCBDC and to operate its platform (whether directly or through third parties); the legal relationship between the central bank and users; and settlement finality of wCBDC transactions.