零售层面央行数字货币的技术白皮书（白皮书）-50正式版

RequestforCommentse-HKD:AtechnicalperspectiveInCollaborationwithBISIHHongKongCentreExecutiveSummary1.TheHKMA’sCBDCjourneyinanutshellTheHKMAbeganresearchingCBDCunderProjectLionRockin2017,andhassincethenactivelycollaboratedwithothercentralbanksinbroadeningourknowledgeofwholesaleCBDC.In2019,theHKMAandtheBankofThailand(BOT)jointlyinitiatedProjectInthanon-LionRocktostudythepotentialofwholesaleCBDCforcross-borderpayments.Theprojectenteredthesecondphasein2020andwassubsequentlyrenamedtoMultipleCBDCBridge(mBridge)inFebruary2021,whenitwasjoinedbytheCentralBankoftheUnitedArabEmiratesandtheDigitalCurrencyInstituteofthePeople’sBankofChina(PBoC),andstronglysupportedbytheBankforInternationalSettlements(BIS)InnovationHubCentreinHongKong.BuildingontheknowledgeandexperienceinwholesaleCBDC,inJune2021,theHKMAcommencedProjecte-HKD,whichisaretailorgeneral-purposeCBDC(rCBDC)projectthataimstostudythefeasibilityofe-HKD.Itcomprisestwocomponents:atechnologyexperimentationstudyandacomprehensivestudyofotherissues,includinglegalandpolicyconsiderations.2.AimofthistechnicalwhitepaperThiswhitepaperispartofthetechnologyexperimentationstudyunderProjecte-HKD.Itexplorespotentialarchitecturesanddesignoptionsthatcouldbeappliedtotheconstructionoftheinfrastructurefordistributinge-HKD,andreportstheinitialthoughtsandfindings.Specifically,itaimstoexploretechnologysolutionsthataddresstheproblemsofcross-ledgersynchronisation,over-issuanceprevention,privacy-preservingtransactiontraceability1,andflexibleinstantiationsofdifferenttwo-tierdistributionsmodels.3.ProposedarchitectureThearchitectureproposedinthiswhitepaperismostnotableforitsabilitytoflexiblyandefficientlyinstantiatedifferenttwo-tierdistributionmodelsofrCBDCwhileachievingbreakthroughsinprivacy-preservingtransactiontraceabilityandcross-ledgersynchronisationofdecoupledledgers.Ingist,theproposedarchitectureconsistsoftwolayers:awholesalesystemforthecentralbanktoissueandredeemCBDC,andaretailsystemforcommercialbankstodistributeandcirculateeitherrCBDCorCBDC-backede-money.Thedesignoftheproposedarchitecturewasguidedbythreekeyprinciples,namely:safety,efficiency,andopennesstochange,innovation,andcompetition.4.TheHKMA’sstance1Thiswhitepaperisawareoftheexistenceofdifferentnotionsofprivacywithmoreaprecisemeaningintheacademicliterature(e.g.privacy,confidentiality,anonymityandpseudonymity,unlinkability,l-diversity,t-closeness).Forthepurposeofthiswhitepaper,thetermprivacyislooselyusedasabroadconcepttorefertothegeneralprotectionofpersonallyidentifiableinformationintransactions.1Itshouldbenotedthattheproposedarchitectureisnotablueprintfore-HKD,nordoesitapproachadecisionontheCBDCdistributionmodelschosenforimplementinge-HKD.Rather,itshouldbeseenastheoutcomeofinitialresearchaswellasabasisforinitiatingdialogueswithcentralbanks,theacademia,andthewiderfintechcommunitytocollaborativelyexploresolutionsforrCBDC.5.SolicitationofinputBasedonaninitial,preliminaryanalysisoftheproposedarchitecture,theHKMAhasidentifiedanumberofareasforfurtherdiscussion,whicharesummarisedassevenproblemstatements(Table1).Wewouldliketoinvitetheacademiaandindustrytocommentonourproposedarchitecturebymakingreferencetothesevenproblemstatements;aswellassolicitnewideasandprojectproposalsfromthem.Inparticular,securitymodellingandanalysisfortheproposeddesign,aswellasideasfornovelusecasesandcapabilitythatcanbeuniquelyenabledbyrCBDCaresought.Feedbackontheproposedarchitecturaldesignandsuggestionsforimprovementtothedesigncanbesubmittedtofintech@.hk

by31December2021.ProblemStatements:

Tostudydifferentprivacymodels(e.g.anonymity,pseudonymity,metadataobfuscation,andtransactionconfidentiality)andtheirapplicabilitytothecontextofrCBDCandCBDC-backede-money

Toproposenewdesignswhichmaintainuserprivacywhileassuring12integrityofsystems(i.e.freefromunauthorisedmanipulation)andtransactions(i.e.correctrecordingoftransactionsandpreventionoffrauds)Privacy

ToresearchtheinteroperabilitybetweenconventionalFinancialMarketInfrastructures(FMIs)andemergingDistributedLedgerTechnology(DLT)-basedsystemsbasedondifferentunderlyingtechnologies(e.g.Corda,HyperledgerFabric,andEthereum)Interoperability

Toexploreemerginginteroperableplatforms

Tostudythetrade-offsbetweenperformanceandothermetrics(security,privacy,etc.)

ToenhancethescalabilityofDLTandotherdistributedsystemswithrespecttoincreasingnumberofusers,numberofvalidationpartiesandtransactionvolume34Performanceandscalability

ToenumeratetheattackvectorsofrCBDCsystems

Toproposeefficientsolutionstowithstandhigh-riskattacksinordertomaintainreasonablecyber-resilience,serviceavailabilityandtransactionsecurityCybersecurity2

ToexplorecomputingmethodstoachieveregulatorycompliancegoalssuchasAML/CFT56Compliance

TostudyrCBDCsystemdesignswhichcouldoperatecorrectlyacrossawiderangeofknownoperationalconditions(e.g.flashtransactiondemand)

TostudyrCBDCsystemdesignswhichcouldadapttoandrecoverfromunforeseeableadverseconditions(e.g.offline-to-offlinepaymentsincaseofconnectivityoutage)Operationalrobustnessandresilience

ToinvestigatehowrCBDCsolutionscanimproveexistingbusinessapplicationsintermsofe.g.efficiency,security,andresilienceand/orbringinnewfunctionalities,featuresandapplicationswhichcannotbeachievedbyexistingmeansofpayments7Technology-enabledfunctionalcapabilitiesTable1.ResearchproblemsonCBDC3TechnologyforeHKD:PotentialArchitecture,DesignOptions,andChallengesAhead1.Introduction1.1.TheHKMA’sCBDCjourney1.1.1.ProjectLionRockTheHKMAbeganresearchingCBDCunderProjectLionRockin2017.Incollaborationwiththethreenote-issuingbanks,theHongKongInterbankClearingLimited,andtheR3consortium,theHKMAcommencedastudyonCBDCin2017withaviewtobetterunderstandingitsfeasibility,implications,andpossiblebenefitsthroughexploringitsuseindomesticinter-bankpayments,corporatepayments,anddelivery-versus-paymentdebtsecuritiessettlement.InviewofthepotentialbenefitsoftheuseofCBDCatthewholesalelevelhighlightedbythestudy,theHKMAcontinuedtoexplorethepotentialuseandcross-borderuseofCBDCatthewholesalelevel.1.1.2.ProjectInthanon-LionRockAgainstthisbackdrop,theHKMAhasbeenactivelycollaboratingwithothercentralbanksinresearchandproof-of-concept(PoC)studiestobroadenourknowledgeofCBDC.TheHKMAandtheBankofThailand(BOT)initiatedProjectInthanon-LionRockin2019tostudytheapplicationofCBDCtocross-borderpayments.TheprojectwascompletedinDecember2019andaDistributedLedgerTechnology(DLT)-basedPoCprototypewasdevelopedtogetherwith10participatingbanksfromHongKongandThailand.Theprototypeallowsbankstoconductfundstransfersandforeignexchange(FX)transactionsacrossthetwojurisdictionsonapayment-versus-paymentbasisthroughacross-borderCBDCCorridorNetwork.TheHKMAandtheBOTjointlypublishedareportinJanuary2020topresentthekeyfindings.Itwasthenconcurredthatfurtherjointresearchworkinrelevantareaswillbecarriedout,includingexploringbusinesscasesandconnectionstootherplatforms,involvingparticipationofbanksandotherrelevantpartiesincross-borderfundstransfertrials.TogetherwithThailand,HongKongwasrankedfirstinthecategoryofinterbankCBDCdevelopmentofthePwCCBDCGlobalIndex2021.Figure1.TheCBDCjourneyoftheHKMA71.1.3.MultipleCBDCBridgeUponcompletionofProjectInthanon-LionRock,theresearchprojecthasentereditssecondphaseandwasrenamedasMultipleCBDCBridge(mBridge)in2021.FollowingthejoiningoftheCentralBankoftheUnitedArabEmiratesandtheDigitalCurrencyInstituteofthePeople’sBankofChina(PBoC),ProjectmBridgeisnowacollaborationoffourcentralbanksandisstronglysupportedbytheBankforInternationalSettlements(BIS)InnovationHubCentreinHongKong.Theprojectaimstoimprovecross-bordersettlementefficiency,liquiditymanagementefficiency,andcompliancewithanylocalregulationsonFXcontrolwhilefosteringacollaborativeenvironmentforcentralbanksandfinancialinstitutionstostudythepotentialsofDLTinenhancingthefinancialinfrastructureforcross-borderpayments.AninterimreportwaspublishedinSeptember2021.1.1.4.Projecte-HKDandProjectAurumWiththeknowledgeandexperiencebuiltupinwholesaleCBDCstudies,andinthelightoftheincreasingpublicappetitefordigitalpayments,inJune2021,theHKMAcommencedProjecte-HKD,afeasibilitystudyonrCBDCanddigitisationofHongKongDollar(namede-HKD)toexplorethepotentialbenefitsandrisksofissuanceofe-HKD.ThismoveisinlinewiththeglobaltrendofCBDCresearchandtheHKMAwouldliketocontributetothecentralbankdiscussionsonrCBDC.2Notwithstanding,theHKMAhasnotyetmadeadecisiononwhethertointroducee-HKD,butwillremainopen-mindedtoconsiderrelatedquestionscarefully.Projecte-HKDconsistsoftwoparts:atechnologyexperimentationstudyonrCBDCandacomprehensivestudyofotherissuespertainingtothefeasibilityofissuinge-HKD.TheformerispurelyatechnologicalinvestigationoftheinfrastructureneededforissuinganddistributingrCBDC,specifically,onhowtherecognisedissuesofrCBDCcanbeaddressedormitigatedthroughsuitablearchitecturesanddesigns.Thelattercoversusecases,benefits,relatedrisks(suchasdataprivacy,AML,andcybersecurity),andconsiderations(suchaslegalandmonetarypolicy).TheHKMAhasalsobeenpartneringwiththeBISInnovationHubinaPoCstudynamedProjectAurumtoexplorethetechnicalfeasibilityandtrade-offsoftwoofthearchitectures,namelyintermediatedCBDCandCBDC-backede-money.ThePoCstudyalsoaimstodevelopabasicprototypetoimplementselectedelementsofthearchitecturepresentedinthiswhitepaper.1.2.PurposeofthistechnicalwhitepaperThistechnicalwhitepaper,aspartofthetechnologyexperimentationstudyunderProjecte-HKD,reportstheinitialthoughtsandfindingsoftheexplorationofthepotentialarchitecturesanddesignoptionsthatcouldbeappliedtotheconstructionofthedistributioninfrastructureofe-HKD.BasedonareasonablyrigorousevaluationofdifferentdistributionmodelsforrCBDC,asinformedbypaststudiescarriedoutbyothercentralbanksandtheprivatesector,thiswhitepaperoutlinesanillustrativetechnologyarchitectureofrCBDCdesignedtoenablehouseholdsandbusinessestoholdandmakepaymentswithCBDCwhilealleviatingsomeofthemajorrisksanddrawbacksofrCBDC.Thepurposeofthiswhitepaperistobeginadialogueonthe2ABISstudy(Aueretal.,2021)indicatesthat,asofJuly,2021,69projectsonrCBDCand31projectsonwholesaleCBDChavebeenreportedlycarriedoutbycentralbanks.8appropriatedesignofe-HKDandanevaluationofwhetherthebenefitsofe-HKD,andrCBDCingeneral,outweighitsrisks.Basedonaninitial,preliminaryanalysisoftheproposedarchitecture,theHKMAhasidentifiedanumberofareasforfurtherdiscussion,whicharesummarisedassevenproblemstatements(Table1).Wewouldliketoinvitetheacademiaandindustrytocommentonourproposedarchitecturebymakingreferencetothesevenproblemstatements;aswellassolicitnewideasandprojectproposalsfromthem.1.3.StructureofthistechnicalwhitepaperTheorganisationofthiswhitepaperisstructuredwithreferencetothedesignthinkingprocess,andinputsandsuggestionsforsubsequentiterationsofthewhitepaperareinvited.Chapter2presentsthebackgroundofCBDCresearch,empathizingwithknownconcernsonrCBDCandsettingthebackdropforproblemformulation.Chapter3definestheproblemanddesignissuestobeexploredinthistechnologystudy.Chapter4setsoutthedesignprinciplesfortechnologysolutionideationandChapter5suggeststhepossiblearchitecturaldesigns.Chapter6presentsapreliminaryevaluationanddirectionforfurthertesting.Chapter7outlinestheareasforfurtherresearch.1.4.TheHKMA’sstanceThistechnicalwhitepapermainlypertainstothetechnologyfortheinfrastructureofrCBDC.ItwillnotaddresswhetherorwhyacentralbankshouldissueanrCBDC.Instead,itfocusesonhowacentralbankcanissueanrCBDCpracticallyifitconsidersthatsuchissuanceisdesirableinthelocalcontext.Specifically,itcoverssomefeasibletechnologicalarchitecturesanddesignoptionsoftherCBDCinfrastructurethatcouldaddresssomeoftheknownoperationalconcerns.Thearchitectureproposedinthiswhitepaperisnotablueprintfortheinfrastructureofe-HKD,nordoesitapproachadecisionontheCBDCdistributionmodelchosenforimplementinge-HKD.Rather,itshouldbeseenastheoutcomeofinitialresearchaswellasabasisforinitiatingdialogueswithcentralbanks,theacademia,andthewiderfintechcommunitytocollaborativelyexplorepracticalandrobustsolutionsforrCBDC.92.Background2.1ThetwoelementsofanrCBDCTherearetwoelementsinanyrCBDC,namely,theCBDCitself(i.e.theassetandpaymentinstrumentperse)andtheunderlyinginfrastructurethatallowsCBDCtobetransferredandusedforpayments.Theformerpertainstotheeconomicdesign,concerningaspectssuchasaccess,remuneration,quantitativelimits,andconvertibility.ThelatterconcernshowaCBDCisprovisioned,itsfunctionaldesign,thetechnologytobeused,andtheoperationalprocessesandrulestobeimplemented.TheprovisionarrangementdelineatesbetweenacentralbankandtheprivatesectortheirresponsibilitiesandfunctionsinvolvedinprovidingaCBDC.ThefunctionaldesignconcernshowusersanddifferentstakeholderswouldinteractwithaCBDCandthetypesofpaymentsthatcanbemadewiththeCBDC.Itwouldhaveimpactonuser-friendliness,levelofprivacyofthesystem,andthetechnologicalchoicesforimplementingtheinfrastructure.2.2Differentarchitecturaldesigns2.2.1Direct(orone-tier)rCBDCmodelIfanrCBDCisprovisionedthroughaone-tiersystemfullyoperatedbyacentralbank,whichiscalledthedirectCBDCmodel,suchanarrangementwouldfacevariousoperationalandpolicychallenges.AdirectCBDCmodelwouldimplyalargeshiftofoperationaltasksandcostsassociatedwithcustomer-facingactivitiesfromtheprivatesectortothecentralbank(Auer&Böhme,2021;BankforInternationalSettlements,2021).Theseincludeaccountopening,accountmaintenance,enforcementofAML/CFTrules,userauthentication,andotherday-to-daycustomerservices.Suchashiftwoulddetractthecentralbankfromitsroleasarelativelyleanandfocusedpublicinstitutionatthehelmofeconomicpolicy(BankforInternationalSettlements,2021).Inaddition,anrCBDCcouldbecomeanewtargetforcyberthreats(Quarles,2021;Waller,2021).MaintainingcybersecurityandavailabilityoftheinfrastructureatascalecommensuratewiththeuserbaseofanrCBDCischallengingandunprecedentedforcentralbanks.Inparticular,unlikeawholesalesystem,aretailsystemisrelativelyopen,meaningthatnotalltheparticipantsarefullytrustworthy.Therearealsoprivacyconcernsandimpactonlong-terminnovationassociatedwiththedirectCBDCmodel.UserprivacyisoftenseenasthemostvaluedpropertyandakeysuccessfactorthatdetermineswhetheranrCBDCwouldbegenerallyacceptedandusedbythegeneralpublic(EuropeanCentralBank,2021).Underthismodel,thecentralbank,whichprocessesretailtransactions,couldbecomearepositoryforeconomy-widetransaction-leveldata.Theresponsibilitiesofthecentralbankforprotectingprivacyanduserdata,includingfromotherarmsofthegovernment,couldbeonerous(Auer&Böhme,2021;GroupofThirty,2020).Ontheotherhand,apaymentsysteminwhichthecentralbankhasalargefootprintwouldimplythatitcouldquicklyfinditselfassumingafinancialintermediationfunctionthatprivatesectorintermediariesarebettersuitedtoperform.Thishaslong-termimpactonfinancialinnovationasbanksandPSPsareinabetterpositionthanthecentralbanktoleadinnovativeinitiativesandintegratepaymentserviceswithconsumerplatformsandotherfinancialproducts(BankforInternationalSettlements,2021).2.2.2Two-tierrCBDCmodelsAnrCBDCisthereforebestdesignedaspartofatwo-tiersystem,withanappropriatedivisionoflabourbetweenthecentralbankandprivatesectorintermediariesforthedistributionandcirculationofCBDC.Atypicaltwo-tierdistributionmodelofrCBDCconsistsof10twoseparate,connectedlayers,namely,thewholesaleinterbanksystemandtheretailuserwalletsystem.Thecentralbankandprivatesectorintermediaries(includingbanksandPSPs)couldcontinuetoworktogetherinacomplementaryway,witheachdoingwhattheydobest(Auer&Böhme,2020;BankforInternationalSettlements,2021).Thecentralbankcanfocusonprovidingthecore,foundationalinfrastructureofaCBDC,guaranteeingthestabilityofitsvalueandoverseeingthesystem’ssecurity,soastopromotealevelplayingfieldfortheprivatesector(BankforInternationalSettlements,2021;GroupofThirty,2020).Inturn,themajorityoftheoperationaltasksandconsumer-facingactivitiescanbedelegatedtoprivatesectorintermediaries,whichcouldusetheircreativityandingenuitytoprovideretailservicestocustomersonacompetitivebasis,andleveragetheirnetworkeffectstoinnovateinbusinessandservicemodels.2.3Fourtypesofdistributionmodels2.3.1VariantofdirectCBDCmodelDependingonthedivisionoflabourbetweenthecentralbankandtheprivatesector,andhowtheledgerofretailaccountbalancesisadministered,differenttwo-tierdistributionmodelscanbedesigned,withdifferenttrade-offs.ThesemodelsarenamedbasedonAuer&Böhme(2021)anddepictedinFigure2.Inthesimplestform,withonlycustomer-facingandauthenticationtasksdelegatedtotheprivatesectorintermediaries,thecentralbankstillmaintainstheretailbalancesandprocessesretailpaymenttransactions.ThisisseenasavariantofthedirectCBDCmodel(BankforInternationalSettlements,2021;Auer&Böhme,2021).2.3.2HybridmodelInthehybridCBDCmodel,inadditiontothecommoncustomer-facingtasksanduserauthentication,theprivatesectorintermediariesalsoprocessallretailpaymenttransactionsinrealtime.Butthecentralbank,thoughnotprocessingretailtransactions,wouldstillrecordallretailbalances,ascommunicatedfromtheintermediaries.Dependingonthedesign,anintermediarycouldkeepawholecopyorpartoftheretailledger,andsynchronisesitscopywiththecentralbankrecord,andpossiblywiththecopiesheldbyotherintermediaries,inrealtimeorperiodically,withorwithoutusingDLT.ThishybridCBDCmodelallowsthecentralbanktoactasabackstoptothepaymentsystem.Shouldanintermediaryfail,thecentralbankstillhasthenecessaryinformationtoallowittosubstitutefortheintermediaryandguaranteeaworkingpaymentsystem(Auer&Böhme,2021;BankforInternationalSettlements,2021).Thedownsideisthatthecentralbank’sresponsibilitytosafeguarduserdatawouldbegreater.2.3.3IntermediatedmodelInanalternativemodelcalledtheintermediatedCBDCmodel,thecentralbankdoesnotrecordanyretailbalance.Itonlykeepsthewholesalebalancesofindividualintermediaries.Thedetailedrecordsofretailtransactionsandbalancesaremaintainedbytherespectiveintermediaries(Auer&Böhme,2021;BankforInternationalSettlements,2021).Theinfrastructureandoperationwouldberoughlysimilartothatofthefastretailpaymentsystems.Theoperationalburdenonthepartofthecentralbankisminimum,andbettercyberresiliencemaybeachievedthroughahigherdegreeofdecouplingbetweenthewholesaleandtheretailledger.Sincethecentralbankdoesnotneedtorecordretailbalancesorusertransactions,itsresponsibilitytosafeguarduserdataisalsolower.Thisisalsoinlinewiththeobservationthatpeopletendtotrusttraditionalfinancialinstitutionsmoretosafeguardtheirdata(BankforInternationalSettlements,2021).However,thedownsideisthatadditionalsafeguardsoroversight(andprudentialstandards)would11benecessary,astheintermediarieswouldneedtobesupervisedtoensureatalltimesthatthewholesaleholdingstheycommunicatetothecentralbankaccuratelyreflecttheretailholdingsoftheirclients(BankforInternationalSettlements,2021).2.3.4CBDC-backede-moneyThesameinfrastructureusedinthetwo-tierdistributionmodelsofCBDCmayalsobeusedforintermediaries’issuanceofe-money,whichisfullybackedbyCBDC.ThisCBDC-backede-moneyiscompatiblewiththenote-issuingbanksystemofHongKong.UnlikeanrCBDC,whichisadirectliabilityofthecentralbank,CBDC-backede-moneyisprivatemoney(i.e.aliabilityoftheissuingintermediary)despitethatsucharrangementsareoftentermedindirectorsyntheticCBDC(Adrian&Mancini-Griffoli,2019;Kumhof&Noone,2018).WhileanrCBDCwouldstrikeanewbalancebetweencentralbankmoneyandprivatemoney(BankforInternationalSettlements,2021),CBDC-backede-moneytendstopreservetheexistingtwo-tiermonetarysystem.Insufficienttransparencyinthemanagementofthebackingassetsandinadequateconsumerprotectionareusuallycitedasthemainissuesoftypicalstablecoinarrangements(Bullmannetal.,2019).ThebenefitsofCBDC-backede-moneyareimprovedsafetyandcustomerprotection.3SincethecentralbankisnottheissueroftheCBDC-backede-money,thecentralbankwouldnothavetomaintainretailbalances,anditsresponsibilitytosafeguarduserdataisalsolowered.Itsoversightresponsibilityistoensurethatanintermediarywouldnotover-issuee-moneywithoutadequatebackingofCBDC.However,thecentralbankmaylackinformationtohonourclaimsonthebackingassetsunderitscustodywhenanissuingintermediarybecomesinsolvent3Comparedtothearrangementthatprivatepaymentserviceprovidersholdcustomerbalancesasbankdeposits,fullbackingbyCBDCcouldreducethesystematicrisksandrunsonmoneymarketfunds,whichareidentifiedbyGroupofThirty(2020),thatmaybeintroducedinfaceofconcertedredemptionsbycustomers.12Figure2.Divisionofworkbetweencentralbankandtheprivatesectorindifferenttwo-tierrCBDCarchitectures.Source:AdaptedfromAuerandBöhme(2021)132.4Trade-offsbetweendifferentmodelsDifferenttrade-offscanbeobservedinthesetwo-tierdistributionmodels,namely,thecentralbank’soperationalburdens,thelevelofdecouplingbetweenthewholesaleandretailledger,thecentralbank’sresponsibilitytosafeguarduserdata,andtherequiredleveloftrustontheintermediaries(orcorrespondinglythecentralbank’ssupervisoryburden).Thelevelofdecouplingbetweenthetwoledgershasimplicationsoncyberresilience,basedontheprincipleofprivilegeseparationornetworksegmentation(Provosetal.,2003;AustralianCyberSecurityCentre,2019).TheintermediatedmodelandCBDC-backede-moneyhaveahigherlevelofdecoupling,andhencebettercyberresilience,thanthehybridmodel.Thecentralbank’soperationalburdenandresponsibilitytosafeguarduserdataarealsolowerinthesetwomodels.However,asatrade-off,thesetwomodelsrequireahigherleveloftrustontheintermediaries,orstrongersafeguardsoroversightontheiractivities,whichtranslatesintohighersupervisoryburdenonthecentralbank.AuerandBöhme(2021)nicelysummarisesthedynamicsregardingthechoicebetweenthehybridandintermediatedmodel:thecentralbankhastooperateeitheracomplextechnicalinfrastructureoracomplexsupervisoryregime.Figure3.Trade-offsbetweendifferentmodels3.Keydesignconsiderationsandquestionsofatwo-tierdistributionmodel3.1Elementsthatmakeagooddesign3.1.1DecouplingofwholesaleandretaillayersAtypicaltwo-tierdistributionmodelofrCBDCconsistsoftwoseparate,connectedlayers,namely,thewholesaleinterbanksystemandtheretailuserwalletsystem.Onlyintermediaries(banksandPSPs)

whicharerelativelymoretrustworthy

canparticipateinthewholesalelayer,whereas,theretaillayerisanopensystemaccessibletothegeneralpublic.Inotherwords,adversariesmayexistintheretaillayertolaunchcyberattacks,aimingtounderminetheoperationoftheCBDCsystem.Ideally,agooddesignshoulddecouplethetwolayersasmuchaspossibleinordertoensurethatcyberattacksfromtheretailusersystemwillnotbecascadedintothewholesaleinterbanknetwork,whichmaypossiblyunderminetheCBDCissuanceprocess.Theintermediarieswithpresenceinbothlayerswouldbetheonlychannelforcross-layercommunications.Inaddition,14intwo-tierdistributionmodelsliketheintermediatedCBDCmodelandCBDC-backede-money,foruserprivacyconsiderations,thesystemisdesignedsuchthatthecentralbankdoesnotrecordretailbalances,resultinginminimuminteractionsbetweenthetwolayerswhenpaymentsaremadeintheretaillayer.Theintermediarieswouldberesponsibleformaintainingthecorrectnessoftheretailbalances.Figure4.Atwo-tierdistributionmodelforrCBDC3.1.2Cross-ledgersynchronisationWhiledesirableforcyberresilienceand,sometimes,foruserprivacyconsiderations,thedecouplingofthewholesaleandretaillayersposeschallengesforcross-ledgersynchronisation.Arobustdesignisnecessarytoguardagainstthepossibilityofover-issuanceanddoublespendingbyanintermediary.Thedecouplingofthetwolayersposeschallengestomaintainingcongruenceoftherespectiveledgers,especially,whenallthecommunications