28th Parliamentary Intelligence-Security Forum – The Geopolitical Impact of Digital Currencies
Dr. Francisco Dakila discussed digital currencies focusing on Bangko Sentral ng Pilipinas (BSP) initiatives. He categorized digital currencies into Central Bank Digital Currency (CBDC) and Private Digital Currency, highlighting global CBDC Initiatives like Project Nexus and Project mBridge for cross-border settlements.
Dr. Dakila elaborated on the BSPs Project Agila, a pilot wholesale CBDC project. He noted the rise in digital transactions of fiat currency amid increasing e-wallet subscriptions. He emphasized CBDCs potential as geopolitical instruments capable of reducing transaction costs and reliance on third-party service providers, especially for remittances. He also pointed out that the continued use of CBDCs could decrease reliance on the US dollar.
In closing, Dr. Dakila observed that despite the increasing volume of digital payments, the use of privately issued digital currencies as a means of payment in the Philippines remains limited. He added that majority of the central banks, as with the BSP, are taking a gradual approach to retail CBDCs due to policy concerns and are instead exploring use of wholesale CBDCs for cross-border settlement. He reiterated that the BSP adheres to the Bank for International Settlements “do no harm principle” for CBDC development.
