How Does a Central Bank Digital Currency (CBDC) Proposal Address Settlement Fees?
CBDC proposals often aim to reduce or eliminate settlement fees by providing a direct digital liability of the central bank, bypassing commercial banks and traditional payment rails. By creating a direct, real-time settlement mechanism, a CBDC could drastically lower the cost and time of transactions for both consumers and businesses, simplifying the payment infrastructure.
Glossar
Central Bank Digital Currency
Architecture ⎊ Central Bank Digital Currency represents a fundamental shift in monetary system infrastructure, potentially enabling programmable money and real-time settlement capabilities within existing financial rails.
CBDC
Currency ⎊ Central Bank Digital Currency (CBDC) represents a digital form of a nation's fiat currency, issued and regulated by the central bank, distinct from decentralized cryptocurrencies.
Settlement Fees
Transaction ⎊ In cryptocurrency derivatives, options trading, and financial derivatives generally, transaction-related settlement fees represent charges levied by exchanges, clearinghouses, or custodians to finalize and validate the completion of a trade.
Proposal
Governance ⎊ Within decentralized autonomous organizations governing crypto derivatives platforms, a Proposal serves as the formal on-chain or off-chain submission for a change in protocol parameters or resource allocation.