G7 financial executives met in Washington yesterday to discuss central bank digital currencies and endorse public policy principles for their implementation.

"The G7, which includes Canada, France, Germany, Italy, Japan, the United Kingdom and the United States, demanded that any newly launched CBDCs not prevent central banks from maintaining financial stability.

In a joint statement, G7 finance ministers and central bank governors said strong international coordination and cooperation on these issues would help ensure that innovations in the public and private sectors deliver domestic and cross-border benefits while being safe for users and the financial system as a whole.

They added that CBDCs will be able to complement cash and act as liquid, secure settlement assets in addition to binding existing payment systems. Digital currencies must be energy efficient and fully interoperable across borders, the statement said.

G7 leaders affirmed that they have a shared responsibility to minimize the secondary effects of CBDC on the international monetary system. The issuance of CBDC should be based on public commitments to transparency, the rule of law and sound economic governance. Recall that all G7 countries have yet to issue CBDCs, but some, such as England, are exploring technology and economic implications.

According to officials, no global steiblocoin project should begin operation until it has met legislative, regulatory and supervisory requirements.

In particular, the U.S. is still dragging its feet on plans to develop CBDC, and the Federal Reserve remains highly skeptical of digital dollars. At the same time, the U.S. could be the outsider in this regard if it does not take active action. China, for example, is already well ahead of the competition with its digital yuan, and the country's central bank continues to work on further integrating it into its financial system.

It could be that while G7 officials are discussing the implementation of CBDC, China will be the world leader in this area and will dictate the rules of the game to everyone else in this market.