An international study into why some countries are accelerating Central Bank Digital Currency (CBDC) projects, and why others are holding back, has found that the adoption of CBDCs is shaped less by technological readiness or economic development, and more by politics, levels of government transparency and, in some cases, corruption.

A CBDC is a digital form of government-issued money, backed and regulated by a nation's central bank.

The research, led by Nottingham Business School (NBS), part of Nottingham Trent University, analyzed 68 countries and revealed that more authoritarian governments are leading the charge on CBDCs due to centralized power structures which allow these governments to quickly implement tightly controlled systems—often leveraging digital currencies to enhance surveillance and control capital flows.

In contrast, countries with more democratic institutions and political systems are proceeding with more caution, taking time to address concerns around privacy, transparency, and trust before moving forward.

The study also explored the relationship between corruption and CBDC adoption and found that countries with higher levels of perceived corruption are more likely to explore digital currencies.

Dr. Milad Armani Dehghani, who led the research with Professor Alex Brauneis from Nottingham Business School, said, "At first, that might seem backwards. But when you think about it, it starts to make sense. Digital currencies give governments powerful tools to fight things like money laundering, tax evasion, and illegal money flows, especially in places where traditional banking systems aren't exactly known for being transparent.

"Take China's e-CNY, for example. It's built on encrypted tech that lets the government track spending and stop things like counterfeit currency.