The central bank issued a “Summary Report on Central Bank Digital Currency (CBDC) External Communication Activities” on April 15, marking the first time it systematically disclosed its communication achievements and policy thinking in recent years. The report shows that Taiwan is currently adopting a “prudent advancement” strategy for CBDC development. In the short term, there is no urgency to issue a retail CBDC, but it has also accelerated the trial and rollout planning for wholesale CBDC and the infrastructure for asset tokenization.
In response to market concerns about inflation and the money supply, the central bank clearly addressed in the report that whether the public converts CBDC from deposits, or banks convert wholesale CBDC from reserves, the essence is simply a conversion of asset form rather than the creation of additional money supply. This once again contradicts the claims made earlier by influencer Qu Bo, who said in a livestream of the Taiwan Blockchain Association that the issuance of stablecoins turns one U.S. dollar into three.
Taiwan’s CBDC strategy is not meant to mirror China’s digital yuan or retail payments; instead, it is more in line with the tokenized financial infrastructure being promoted by the Bank for International Settlements (BIS). In essence, it is closer to cash than to electronic payments or stablecoins. No matter how large the latter are, fundamentally they are still market choices; but once CBDC goes live, it could become a payment instrument with mandatory acceptance. If CBDC is issued in the future, its legal status would be that of “legal tender,” and merchants generally may not refuse to accept it unless otherwise specified by law or contract.
Taiwan’s payments ecosystem is mature—CBDC is a “public option,” not a substitute
In the report, the central bank explicitly pointed out that Taiwan’s current payment instruments are highly diversified and convenient. Credit cards, electronic payments, bank transfers, and other options all operate instantly, so there is no need to urgently promote retail CBDC. However, from a long-term perspective, CBDC still has three strategic values: preserving a public payment option, establishing shared infrastructure, and serving as a policy tool to support innovative applications.
Among them, the central bank emphasized that CBDC can prevent future payment markets from being overly dominated by the private sector, and it can solve the problem of payment fragmentation by building a shared platform. At the same time, CBDC can also support applications such as government subsidies and digital voucher issuance, improving the efficiency of policy implementation.
No change in transaction volume, no impact on inflation—the central bank emphasizes it is only a “conversion of monetary form”
In response to market concerns about inflation and money supply, the central bank clearly addressed it in the report, and you could even say it set the tone: CBDC and cash or bank deposits are converted 1:1 at equivalence, without increasing the overall money supply (M2), and therefore will not affect inflation. Whether the public converts CBDC from deposits or banks convert wholesale CBDC from reserves, the essence is simply a conversion of asset form rather than the creation of additional money supply.
This once again contradicts the claims made earlier by influencer Qu Bo. In his livestream with the Taiwan Blockchain Association, he said that (3:25:47 begins), the issuance of stablecoins turns one U.S. dollar into three.
Qu Bo said: When issuers issue $4 trillion worth of stablecoins, that is treated as (cash); the issuer has $4 trillion, and then uses it to buy $4 trillion worth of U.S. Treasury reserves. Then the U.S. government gets $4 trillion in cash, of course it spends it. At this time, there are $4 trillion in the real world circulating, and on-chain there is $4 trillion in stablecoins circulating as well. He even makes a bolder guess that the goal of people playing the crypto industry is to sell short and buy short crypto and dump it to stablecoin holders; at that point, the $4 trillion worth of crypto is also circulating on-chain.
He said that on-chain there are $4 trillion worth of crypto circulating, and $4 trillion worth of stablecoins circulating; in the real world, there are also $4 trillion in circulation. That way, one dollar becomes three.
Avoid “digital bank runs”—wallet limits + non-interest bearing as the core design
To prevent CBDC from creating an impact on the banking system, the central bank has planned multiple risk-control mechanisms, including setting holding limits for personal and corporate wallets, and not providing interest in the initial issuance period.
The purpose of this design is to avoid large amounts of funds moving from bank deposits into CBDC, which would lead to risks such as financial disintermediation or digital bank runs. At the same time, CBDC’s architecture still adopts a “two-tier” system, with banks and payment institutions acting as intermediaries, thereby maintaining the operation of the current financial system.
CBDC vs. stablecoins: central bank money remains the final settlement asset
Amid the market’s intense focus on stablecoin development, the central bank also clearly distinguishes three types of digital currency forms in the report: CBDC, stablecoins, and deposit tokens. Among them, CBDC is issued by the central bank and is a credit-risk-free asset; stablecoins are mostly issued by the private sector and still involve reserve assets and credit risk; deposit tokens are a tokenized form of bank deposits. The central bank emphasized that in a future tokenized financial ecosystem, final settlement will still need to rely on central bank money, and wholesale CBDC will play a key role.
Technical route splits: retail goes centralized, wholesale goes blockchain
On the technical architecture, the central bank adopts a clear “dual-track strategy.” Retail CBDC will use a centralized system to support high-frequency trading and integrate existing TWQR, POS, and NFC payment scenarios; wholesale CBDC will use distributed ledger technology (DLT) to support cross-institution settlement of tokenized assets. In addition, the central bank has also tested offline payment technology, but acknowledged that it is not yet mature and still requires ongoing research.
Privacy design adopts “de-identification”—the central bank cannot directly track individuals
Regarding the privacy issue most sensitive to the market, the central bank emphasized that CBDC uses a de-identification design. Users’ personal data is stored only with the intermediary institutions, and the central bank cannot directly identify individuals’ transaction records. Only in cases of abnormal transactions or when judicial authorities investigate in accordance with law might relevant information be accessed. In addition, small-value transactions can even be conducted through anonymous wallets, requiring only phone number verification.
1,714 people, 219 institutions involved—seven major topics as the policy core
Another key point of this report is disclosing the central bank’s external communication achievements over the past two years. Since 2023, the central bank has collected input from all sectors through surveys and in-person activities. In 2025 alone, it held 9 public hearings, forums, and briefings, with a cumulative participation of 1,714 people and coverage of 219 institutions, spanning the financial industry, payment industry, virtual asset providers, and academia.
After consolidating, market concerns focused on seven major topics, including policy positioning, comparison with stablecoins, regulatory framework, technology choices, risk and privacy, financial inclusion, and cross-border payments and RWA tokenization applications.
Taiwan’s CBDC merchants generally may not refuse to accept it
The report repeatedly emphasizes that wholesale CBDC will serve as the settlement core in the tokenized world. It has already partnered with the Taiwan Depository & Clearing Corporation to test “Delivery versus Payment (DvP)” for tokenized corporate bonds, and it is also exploring a unified settlement framework across institutions and across assets.
This means that Taiwan’s CBDC strategy is not aimed at mirroring China’s digital yuan or retail payments, but is more akin to the “tokenized financial infrastructure” promoted by the Bank for International Settlements (BIS). This means that the essence of CBDC is closer to cash rather than electronic payments or stablecoins. No matter how large the latter are, fundamentally they are still market choices; but once CBDC goes live, it could become a payment instrument with mandatory acceptance.
The central bank has clearly stated that if CBDC is issued in the future, its legal status would be “legal tender,” and merchants generally may not refuse to accept it unless otherwise specified by law or contract.
This article “Central bank releases digital currency report—debunking Qu Bo? If Taiwan issues CBDC, merchants generally cannot refuse to accept it” first appeared on Chain News ABMedia.
