COMPARATIVE REVIEW OF THE LEGAL STATUS OF NATIONAL CRYPTOCURRENCIES AND CBDCs

Abstract

This paper analyses the legal framework of national virtual currencies and so-called Central Bank Digital Currencies (CBDCs) from a comparative law perspective. The authors define the meaning of the terms “means of payment” and “legal tender” and determine the legal consequences of classifying certain means of payment as legal tender. Building on this, the authors present new developments in the field of sovereign virtual currencies and shed light on their evolution through a comparative legal analysis of various national virtual currencies. In this context, the authors present developments in various African countries, Venezuela’s initiative to introduce the first state-backed crypto token, the first CBDC pilot projects in Uruguay and China, and considerations to introduce a CBDC in the EU. Based on the analyzed systems, problems regarding privacy, user protection and effective regulation of transactions are highlighted in order to present the legal challenges for the establishment of a fully functional (supra-)national euro CBDC.

Keywords

• virtual currency
• cbdc
• payment
• legal tender
• digital euro