When we pay with physical dollar bills, it's an exchange of unique notes with their own serialnumber. A digital currency would be the same thing, but electronic.
Why is a new currency needed for that? All I see is handwavy explanations with zero actual details about how a new digital currency would let us do anything that we can't do more easily without adding a new currency.
Governments and central banks are doing it to try to continue the cash economy, which has been slowly dying for some time now (a death recently sped up by the pandemic). Cash has some unique benefits over numbers in an account, the primary perhaps being that it's independent of banks.
Imagine using GIT for accounting.