Digital money glossary

Account-based design

A design in which money is a balance in an verified account; to validate a transaction, the account holder's identity is known.

Bank deposits

Money held in a bank account; it is the bank's debt to the account holder. In Türkiye it is regulated by Banking Law No. 5411.

Central bank digital currency (CBDC)

A national currency issued by a country's central bank in digital form, which is a direct liability of the central bank.

The digital euro and the digital Turkish lira are projects discussed within this scope.

Crypto-asset

A digital asset created and transferred using distributed ledger technology. Many have no issuer and their value may fluctuate.

Digital bank run

In a crisis, people very rapidly converting their deposits into digital central bank money.

Digital Turkish lira (DTL)

The digital form of the Turkish lira, which the CBRT has been working on since 2020. No decision to put it into circulation has yet been made. Read more

Digital wallet

An application or card in which digital money is held and from which payments are initiated.

Disintermediation

The risk that, as deposits shift from banks to central bank money, banks' capacity to extend credit weakens.

Distributed ledger technology (DLT)

Technology in which records are kept not in a single central location but in simultaneous copies held by multiple participants. Blockchain is one type of it.

E-money

Digital value created against funds received, issued by payment and electronic money institutions. In Türkiye it is regulated by Law No. 6493.

Holding limit

The maximum amount of digital money an individual may hold; discussed as a way to limit sudden outflows of funds from banks.

Intermediary

A bank, payment institution or electronic money institution that offers users a digital money wallet and payment services.

Know your customer (KYC)

The verification by an intermediary of a customer's identity, as required by anti-money laundering and countering the financing of terrorism rules.

Legal redress

CBDC SPAR's measured dimensions include one of the following: a belief that, when a problem arises, there is an effective route for objection and redress. Read more

Legal tender

Money that a creditor is obliged to accept in settlement of a debt. In Türkiye banknotes have this status; the status of the digital Turkish lira must be determined by legislation.

Offline payment

A digital payment made without internet or mobile network connectivity, usually enabled by a smart card or secure chip.

Payment autonomy

CBDC SPAR's measured dimensions include one of the following: an expectation that individuals themselves decide when and on what money is spent. Read more

Privacy-enhancing technologies

Technical methods that allow the accuracy of a transaction to be proven without disclosing more personal data than necessary.

Programmable money

Money to which rules are attached about where, when or on what it may be spent. This is the design most often objected to in terms of payment autonomy and property rights.

Programmable payment

A payment tied to a condition, for example one that is made automatically once delivery is confirmed.

Pseudonymisation

Replacing personal data with a code such that it cannot be linked to a person without additional information.

Retail CBDC

A central bank digital currency designed for everyday payments by citizens and businesses.

Stablecoin

A crypto-asset issued by a private company that aims to peg its value to a national currency or asset. It is not central bank money.

Surveillance perception

CBDC SPAR's measured dimensions include one of the following: concern that payments may be traceable and that this information could be used beyond its intended purpose. Read more

Token-based design

A design in which money is a digital unit held by its owner; to validate a transaction, the authenticity of the token is known.

Tokenisation

The representation of an asset or right as a transferable unit within a digital record system.

Two-tier (hybrid) model

A structure in which money remains a liability of the central bank, while wallet and payment services are provided by banks and payment institutions.

The CBRT's reports describe this structure for the digital Turkish lira.

User-sovereign identity

A digital identity approach in which a person keeps their identity information under their own control and shares only what is necessary.

Wholesale CBDC

A central bank digital currency used only for large-value payments between banks and financial institutions.

We explain how the concepts work together in the CBDC guide, and the project in Türkiye in the digital Turkish lira guide .