A new financial regulatory framework for digital finance: Inspired by CBDC

Yi-Shuai Ren, Chaoqun Ma and Yiran Wang

Global Finance Journal, 2024, vol. 62, issue C

Abstract: In recent years, a series of new digital financial technologies (fintech) such as open banking and distributed finance have emerged; however, the advancement of financial regulatory technology has been relatively sluggish. This study conducts a thorough analysis and simulation of a proposed innovative financial regulation solution inspired by central bank digital currency that combines homomorphic encryption algorithms with blockchain technology. Our findings demonstrate that the solution can assist regulatory authorities in validating input data through a process of obtaining accurate regulatory indicators from concrete financial scenarios without revealing confidential information from financial institutions. Moreover, the integration of homomorphic encryption algorithms with blockchain technology has promise for the automated and intelligent oversight of financial systems. Finally, our research findings offer vital insights to promote the implementation and expansion of financial regulation in the digital economy era.

Keywords: Central bank digital currency; Financial regulation; Blockchain; Systemic risk management (search for similar items in EconPapers)
JEL-codes: G2 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1044028324000978
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:glofin:v:62:y:2024:i:c:s1044028324000978

DOI: 10.1016/j.gfj.2024.101025

Access Statistics for this article

Global Finance Journal is currently edited by Manuchehr Shahrokhi

More articles in Global Finance Journal from Elsevier
Bibliographic data for series maintained by Catherine Liu ().