Simulating the Adoption of a Retail CBDC

León Carlos (), Moreno Jose F. () and Soramäki Kimmo ()
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León Carlos: Financial Network Analytics Ltd., Tilburg University, London, UK
Moreno Jose F.: Financial Network Analytics Ltd., Barcelona, Spain
Soramäki Kimmo: Financial Network Analytics Ltd., London, UK

Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), 2025, vol. 245, issue 4-5, 401-433

Abstract: We use agent-based modelling to build a digital twin of the retail payment system, where heterogeneous consumers and merchants interact, learn, and adapt as they meet and use different monies and payment instruments. As we introduce an rCBDC, the model simulates its adoption. We calibrate this digital twin to Spain’s retail payment ecosystem. We run hypothetical scenarios that correspond to public discussions about the digital euro. Results show that introducing an rCBDC without attractive design options and stimulus results in low and slow adoption. Results suggest that the reverse waterfall functionality, a positive remuneration spread, and the distribution of government subsidies via rCBDC are effective in fostering adoption; yet, the distribution of government subsidies via rCBDC is the only one that creates incentives to reduce the use of cash. Balance limits and top-up limits are effective in restraining adoption. Results also suggest that combining design options and stimulus with limits to holding rCBDCs could aid in achieving a sweet spot of adoption.

Keywords: payments; money; agent-based modelling; simulation; digital twin (search for similar items in EconPapers)
JEL-codes: C63 D85 E42 E58 O33 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:jns:jbstat:v:245:y:2025:i:4-5:p:401-433:n:1002

DOI: 10.1515/jbnst-2024-0002

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