Abstract
Central banks are thinking about whether they should substitute publicly issued digital currency for the bank-issued digital money that people use every day. How this plays out can profoundly reshape the financial system and make it less stable. This column argues that we don’t need CBDC to solve financial system problems, but with China already headed down the CBDC road, perhaps the best hope is that central banks will all proceed very slowly and stop well short of universal, elastically supplied, interest-bearing digital currency.