Central Bank Digital Currencies: Big Tech in Small States

In October 2020, The Bahamas became the first country in the world to nationally launch a central bank digital currency (CBDC), the Sand Dollar. The impressive growth of this new technology inspires the question: why are so many countries interested in CBDCs? This paper seeks to understand both the drive behind CBDCs in general and why so many developing countries—small states in particular—are adopting them so quickly.