Digital Currencies and Central Banks

Gina Pieters

A chapter in The Palgrave Handbook of Technological Finance, 2021, pp 139-160 from Springer

Abstract: Abstract Whether a novel tool for monetary policy or simply a new factor in domestic and global markets, digital currencies present Central Banks with opportunities and challenges that are not well understood. This chapter begins with a contextual discussion of the declining use of physical currency, highlighting important distinctions between digitized currency, digital currency, and distributed ledger technology, followed by a taxonomy of the six different digital currency types. The remainder of the chapter examines opportunities and challenges topically. Some, such as privacy and anonymity concerns or trade-offs between centralized and decentralized issuances, exist for all digital currency types. Others are more immediately relevant to Central Banks, such a competition between monies, programmable money, and the impact of digital currencies on the global economy, and monetary policy.

Keywords: Digital currency; Central Bank; Monetary policy; Programmable money; Stablecoin; Decentralized; Centralized; CBDC (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-030-65117-6_6

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DOI: 10.1007/978-3-030-65117-6_6

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