Alper Koparan

The global adoption of Central Bank Digital Currencies (CBDCs) represents a pivotal shift in monetary systems, driven by technological advancements and economic imperatives. While a small number of official digital currencies are in circulation, many nations are launching pilot programs to address financial inclusion challenges and enhance economic resilience. This study aims to identify the determinants of digital currency adoption across 116 countries, using logistic regression to analyze the effects of economic, technological, institutional, and financial factors.
The results show that higher GDP levels significantly increase the likelihood of active CBDC adoption by 332.1 percent and pilot adoption by 212.6 percent, reflecting the role of economic development. Greater internet usage improves the odds of active adoption by 12.7 percent and pilot adoption by 13.4 percent, while financial inclusion indicators, such as account ownership, increase the likelihood of adoption by 59 percent for active initiatives and 141 percent for pilot projects. Monetary freedom positively influences active adoption by 31.1 percent, and higher interest rates increase the odds by 20.8 percent. Conversely, business freedom negatively affects active adoption by 27.5 percent and pilot adoption by 29.1 percent, suggesting that countries with strong private-sector digital payment solutions may rely less on CBDCs.
These findings represent the transformative potential of digital currencies to improve financial inclusion and economic participation. Policymakers should prioritize investments in digital infrastructure and financial inclusion initiatives to facilitate the integration of digital currencies into national economies and empower underserved populations globally.