A Decentralized Central Bank Digital Currency

Abdurrahman Arum Rahman

MPRA Paper from University Library of Munich, Germany

Abstract: Central bank digital currency (CBDC) is a digitized fiat currency. As the nature of the central bank is centralized, the CBDC is also centralized. This paper proposes a decentralized CBDC that is controlled by many central banks together or countries in the world. It is only for international transactions between member countries. While domestic transactions continue to use the national currency of each country. A decentralized CBDC can explore the advantages of digital technologies more deeply than the centralized ones by making reconciliations between central banks in real-time. Furthermore, this system provides international liquidity for all (member) countries in the world sustainably and free of charge. This system eliminates global imbalances, makes the exchange rate more stable, and so makes the whole international monetary system naturally more stable. In doing so, the system does not require economic integration so that all countries in the world may join without many conditions.

Keywords: Cryptocurrency; organic system; global currency; international monetary system; global imbalances. (search for similar items in EconPapers)
JEL-codes: E40 E50 O3 (search for similar items in EconPapers)
Date: 2022-01-03
New Economics Papers: this item is included in nep-ban, nep-cwa, nep-mac, nep-mon, nep-opm and nep-pay
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:111361

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