Simin Gao is associate dean and associate professor at the Law School of Tsinghua University, and she got S.J.D from Upenn law school. She is the vice chairman of Bejing Banking Law Association, Bankruptcy Law Association and International Economic Law Association, and a member of Chinese Security law Association, Banking Law Association and Next Generation of International Insolvency Institution. She brings interdisciplinary perspectives to a wide range of emerging issues that encompass bankruptcy law, corporation Law, financial law, law and economic and comparative law. She has authored several publications on Bankruptcy Law, Financial Law and Regulation, which appeared on the law journals in China, U.S. & EU. She received some academic awards including the Gold Medal of International Insolvency Study by the International Insolvency Institution (2017).
The Future of the International Financial System: The Emerging CBDC Network and Its Impact on Regulation
Abstract:
Central bank digital currency (CBDC) is a digital form of fiat currency. CBDC has the potential to be a game challenger in the international financial system, bringing increased complexities arising from technology and regulatory considerations, as well as generating greater currency competition. As more states begin exploring CBDC, the interactions between actors may lead to the emergence of a new CBDC network. What shape would the emerging CBDC network take? What would its network effects be? What would be the impact of the CBDC network on international financial system,or the global financial network? This article explores these questions by examining the emerging CBDC network and its regulatory implications. It argues that the CBDC network would likely be both decentralized and uncoordinated, making it unlikely to lead to convergence in CBDC regulation. The CBDC network would probably bring policy diffusion effects, with states behaving instrumentally, while shaking up the power balance between different actors, generating both cooperation and conflict. The CBDC network also has the potential to push international financial system towards becoming more decentralized.