Central Bank Digital Currencies and Banking: Literature Review and New Questions

James Chapman, Jonathan Chiu, S. Mohammad R. Davoodalhosseini, Janet Hua Jiang, Francisco Rivadeneyra and Yu Zhu

No 2023-4, Discussion Papers from Bank of Canada

Abstract: We review the nascent but fast-growing literature on central bank digital currencies (CBDCs), focusing on their potential impacts on private banks. We evaluate these impacts in three areas of traditional banking: payments, lending and liquidity and maturity transformation. For each area, we discuss the lessons learned and identify gaps in the research yet to be fully explored. We also take a broader look at CBDCs and highlight two promising directions for future research. One is to study CBDCs through the lens of industrial organization, exploring issues such as platform competition and business models. The second is the crypto space and its new developments such as stablecoins and decentralized finance.

Keywords: Central bank research; Digital currencies and fintech; Financial institutions; Financial stability (search for similar items in EconPapers)
JEL-codes: E50 E58 G00 L00 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2023-02
New Economics Papers: this item is included in nep-ban, nep-mon and nep-pay
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:bca:bocadp:23-4

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