Cryptocurrencies and Central Bank Digital Currencies in Global Perspective

This study investigates the relationship between cryptocurrency adoption rates (CARs) and the development of central bank digital currencies (CBDCs) using a global panel of 109 countries from 2020 to 2024. The analysis employs pooled OLS, fixed effects, ordered logistic regression and GMM models with robust controls for macroeconomic indicators, institutional quality, and technological readiness. CBDC status is measured as an ordinal variable representing five development stages, while CAR is derived from the Chainalysis Crypto Adoption Index. The empirical results show that higher CAR significantly in-creases the probability of a country progressing to more advanced CBDC stages. Margins analysis further indicates that increases in CAR substantially reduce the likelihood of re-maining in early CBDC phases and raise the probability of reaching the pilot or launched stages. Heterogeneity analysis reveals that this relationship is strongest in low- and mid-dle-income economies and in countries with low levels of financial inclusion, where cryp-tocurrencies present greater competition to traditional financial systems. The study con-tributes new large-sample evidence to the debate on digital currencies and provides pol-icy-relevant insights: central banks in financially constrained economies appear to adopt CBDCs as developmental tools to enhance financial access and preserve monetary sover-eignty in the face of growing cryptocurrency adoption.