CBDCs face trilemma, warns ECB paper.

TLDR: Central bank digital currencies (CBDCs) face a “trilemma” and cannot simultaneously satisfy three objectives, according to a working paper by the European Central Bank. The paper examines a central bank engaged in financial intermediation and argues that CBDCs cannot fulfill the goals of maintaining price stability, ensuring bank stability, and offering an anonymous means of payment. The authors suggest that central banks must decide which objectives to prioritize when designing and implementing CBDCs.