  With the emergence of Bitcoin and recently proposed stablecoins from
BigTechs, such as Diem (formerly Libra), central banks face growing competition
from private actors offering their own digital alternative to physical cash. We
do not address the normative question whether a central bank should issue a
central bank digital currency (CBDC) or not. Instead, we contribute to the
current research debate by showing how a central bank could do so, if desired.
We propose a token-based system without distributed ledger technology and show
how earlier-deployed, software-only electronic cash can be improved upon to
preserve transaction privacy, meet regulatory requirements in a compelling way,
and offer a level of quantum-resistant protection against systemic privacy
risk. Neither monetary policy nor financial stability would be materially
affected because a CBDC with this design would replicate physical cash rather
than bank deposits.
