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With reference to Central Bank digital currencies, consider the following statements:

1. It is possible to make payments in a digital currency without using US dollar or SWIFT system.
2. A digital currency can be distributed with condition programmed into it such as a time- frame for spending it.

Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2



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Central Bank digital currencies (CBDCs) are designed to be digital representations of a country's official currency. They operate on a decentralized ledger system, such as blockchain, and can enable direct peer-to-peer transactions without the need for intermediaries like the US dollar or the SWIFT system. Therefore, statement 1 is correct.

One of the advantages of CBDCs is the ability to programmatically embed conditions into the digital currency. This means that conditions can be set for the usage of the currency, such as expiration dates or specific timeframes for spending it. This feature provides flexibility and control over the usage of the digital currency. Therefore, statement 2 is also correct.


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