On Digital Currencies

Harald Uhlig ()

Atlantic Economic Journal, 2024, vol. 52, issue 1, No 1, 14 pages

Abstract: Abstract I discuss private and central-bank-issued digital currencies, summarizing my prior research. I argue that prices of private digital currencies such as bitcoin follow random walks or, more generally, risk-adjusted martingales. For central bank digital currencies, I argue that they enhance the trilemma facing a central bank. Of the three objectives, price stability, efficiency, and monetary trust, the central bak can achieve at most two.

Keywords: Bitcoin; Cryptocurrencies; Pricing; Central bank digital currency; CBDC; Bank runs; Monetary stability; E31; E42; E44; E51; E52; G12; G21 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s11293-024-09792-1

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