A Conceptual Model For a Decentralized Central Bank Digital Currency

Central bank digital currency (CBDC) is a digitized fiat currency. As the nature of the central bank is centralized, the CBDC is also centralized. This paper proposes a conceptual model for a decentralized CBDC controlled by many central banks or countries in the world. It is only for international transactions between member countries. While domestic transactions continue to use the national currency of each country. A decentralized CBDC could potentially explore the advantages of digital technologies more deeply than centralized ones by making macro-fundamentals reconciliations between economies in real-time. Furthermore, this concept could also potentially provide international liquidity for all (member) countries in the world sustainably, align macro-fundamental, eliminate global imbalances, and makes the international monetary system naturally more stable. This paper focuses on discussing the conceptual model and theoretical framework of how this system works in providing international liquidity and making the system balanced and stable.