Central bank digital currencies

Trump EO 14178 splits the CBDC field into US-out, China-lead, Europe-follow

President Trump's Executive Order 14178 on digital financial technology, signed January 2025, prohibits federal agencies from 'undertaking any action to establish, issue, or promote a CBDC' and requires termination of any related plans or initiatives. The Federal Reserve - which had never strongly pursued a retail digital dollar - is explicitly out. The House-passed Emmer CBDC Anti-Surveillance State Act is in the Senate and would codify the EO into permanent legislation. The structural consequence is that CBDC standards-setting and global influence in the retail-payments segment shifts to China (by far the largest pilot) and the EU (the only major Western central bank still actively pursuing issuance). Developing-market central banks weighing CBDC adoption are increasingly choosing between PBoC-aligned technical stacks and ECB / BIS frameworks. The US exit from the field is a deliberate strategic decision, not technological inability - and one that constrains US influence in setting CBDC privacy and surveillance norms going forward.

State of the art (2026)

The CBDC field has split along a geopolitical fault line rather than a technical one. From 1 January 2026 China made the e-CNY interest-bearing - the first major CBDC to pay deposit-style interest - building on roughly 3.48 billion cumulative transactions worth about $2.37 trillion by November 2025, and decisively breaking the global consensus that retail CBDCs stay non-remunerated. The US is legally out: Trump's Executive Order 14178 (January 2025) bars the Federal Reserve from issuing one. The ECB, having closed its preparation phase in October 2025, is targeting a digital-euro pilot in the second half of 2027 and possible issuance in 2029, contingent on EU legislation passing in 2026. The Bank of England's design phase concludes in 2026 with a next-steps decision, not a launch. In the West, wholesale settlement is advancing chiefly through private tokenised deposits - Fnality, Partior, JPMorgan's Kinexys - rather than central-bank wholesale CBDCs.

e-CNY interest-bearing transition is the most consequential CBDC design change of 2026

PBoC's transition of e-CNY to interest-bearing digital deposit money from January 2026 is the most consequential CBDC design change in any major economy. Previously the e-CNY operated as a 1:1 substitute for physical cash with no interest payment - similar to most other retail CBDC designs. Interest-bearing CBDC fundamentally changes the competitive dynamics with commercial bank deposits: if e-CNY pays competitive interest, it directly competes for household savings with traditional bank deposits, with significant implications for bank balance sheets, credit creation, and monetary policy transmission. Cumulative e-CNY transactions of 3.48 billion worth approximately $2.4 trillion by November 2025 establish the deployment scale at which this design change matters. The ECB's digital euro will explicitly NOT bear interest, partly to protect the European banking system - the design divergence between China's interest-bearing and Europe's non-interest-bearing approaches reflects fundamentally different policy choices about how much CBDC should be allowed to disintermediate commercial banks.

Wholesale CBDCs + tokenised commercial deposits are the Western private-sector parallel

Retail CBDCs face the US-out / Europe-cautious / China-leads geopolitical fault line. Wholesale CBDCs - used between financial institutions for large-value settlement - have a separate trajectory. The BIS Project mBridge, originally a multilateral cross-border wholesale CBDC platform connecting PBoC, HKMA, Bank of Thailand, Central Bank of UAE, and Saudi Arabian Monetary Authority, was handed over to the participating central banks in October 2024 after BIS withdrawal. The platform continues to operate at the central-banks level. In parallel, tokenised commercial deposits (Fnality - regulated wholesale settlement; Partior - JPMorgan + DBS + Standard Chartered joint venture for interbank cross-border settlement; Onyx by JPM with the JPM Coin product) are scaling as the Western private-sector equivalent. The structural read: retail CBDCs remain a Chinese-led category with EU follow-on; wholesale settlement modernisation runs in parallel through Western private-sector tokenised-deposit platforms rather than central-bank-issued wholesale CBDCs.