PROGRAMMABLE MONEY & SMART CONTRACTS IN CBDC

Abstract

Programmable money and smart contracts represent the next frontier in Central Bank Digital Currency (CBDC) design. Unlike traditional fiat or even basic digital currencies, programmable CBDCs embed logic directly into transactions, enabling conditional payments, automated compliance, and integration with decentralized applications. This chapter explores the architecture, policy implications, and operational use cases of programmable CBDCs, focusing on how smart contracts can transform financial integrity, efficiency, and innovation. It integrates global pilot evidence, regulatory perspectives, and technical literature to provide a holistic view of programmable money in the CBDC ecosystem.