A systematisation of legal-regulatory risks related to central bank digital currencies: a comparative analysis of the US, the UK and China

Central Bank Digital Currencies (CBDCs) are a rapidly growing topic among scholars, regulators, and policymakers. Due to the rise of privately issued cryptocurrencies in recent years and decreasing trust in traditional currencies caused by inflation, there is increasing pressure on central banks to develop their own digital currencies to avoid being left behind. As financial technologies (FinTech) evolve and the risks associated with cryptocurrencies grow, governments are considering the introduction of CBDCs.This article examines the core principles of CBDCs and explores how they could be integrated into the UK's financial system, drawing comparisons with models from China and the United States. To inform legislators and contribute to the scholarly debate, the article focuses on systematising the potential threats that CBDCs may pose to financial stability, individual privacy, and competition in the financial sector. The article concludes by offering recommendations and emphasizing that CBDCs would not eliminate risks, but rather introduce significant and novel ones.