Crypto-currencies – An introduction to not-so-funny moneys

Aaron Kumar and Christie Smith ()

No AN2017/07, Reserve Bank of New Zealand Analytical Notes series from Reserve Bank of New Zealand

Abstract: This paper introduces the distributed ledger technology of crypto-currencies. We aim to increase public understanding of these technologies, highlight some of the risks involved in using cryptocurrencies, and discuss some of the potential implications of these technologies for consumers, financial systems, monetary policy and financial regulation. Crypto-currencies have no physical existence, but are best thought of as electronic accounting systems that keep track of people’s transactions and hence remaining purchasing power. Cryptocurrencies are typically decentralised, with no central authority responsible for maintaining the ledger and no central authority responsible for maintaining the code used to implement the ledger system, unlike the ledgers maintained by commercial banks for example. As crypto-currencies are denominated in their own unit of account, they are like foreign currencies relative to traditional fiat currencies, such as dollars and pounds.

Pages: p.44
Date: 2017-11
New Economics Papers: this item is included in nep-pay
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Journal Article: CRYPTO‐CURRENCIES – AN INTRODUCTION TO NOT‐SO‐FUNNY MONEYS (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:nzb:nzbans:2017/07

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