scholarly journals From Bitcoin to Central Bank Digital Currencies: Making Sense of the Digital Money Revolution

2021 ◽  
Vol 13 (7) ◽  
pp. 165
Author(s):  
Paulo Rupino Cunha ◽  
Paulo Melo ◽  
Helder Sebastião
Keyword(s):  
Central Bank ◽  
Practical Implication ◽  
Grey Literature ◽  
Central Banks ◽  
Decision Makers ◽  
Making Sense ◽  
Extensive Search ◽  
Trade Offs ◽  
Digital Money ◽  
Open Issues

We analyze the path from cryptocurrencies to official Central Bank Digital Currencies (CBDCs), to shed some light on the ultimate dematerialization of money. To that end, we made an extensive search that resulted in a review of more than 100 academic and grey literature references, including official positions from central banks. We present and discuss the characteristics of the different CBDC variants being considered—namely, wholesale, retail, and, for the latter, the account-based, and token-based—as well as ongoing pilots, scenarios of interoperability, and open issues. Our contribution enables decision-makers and society at large to understand the potential advantages and risks of introducing CBDCs, and how these vary according to many technical and economic design choices. The practical implication is that a debate becomes possible about the trade-offs that the stakeholders are willing to accept.

Digital Money, Liquidity, and Monetary Policy (originally published in July 1997)

First Monday ◽  
2005 ◽  
Author(s):  
Aleksander Berentsen
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Money Supply ◽  
Banking System ◽  
Central Banks ◽  
Electronic Payment ◽  
Regulatory Policies ◽  
Digital Money ◽  
Payment Mechanisms ◽  
Retail Payments

The term digital money refers to various proposed electronic payment mechanisms designed for use by consumers to make retail payments. Digital money products have the potential to replace central bank currency, thereby affecting the money supply. This paper studies the effect of replacing central bank currency on the narrowly defined stock of money under various assumptions regarding regulatory policies and monetary operations of central banks and the reaction of the banking system.

Digital currencies hold much promise for central banks

2020 ◽  
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Financial Stability ◽  
Central Banks ◽  
Content Type ◽  
Emerging Nations ◽  
Or Groups ◽  
Potential Applications ◽  
Digital Money ◽  
The Cost

Subject Central bank digital currencies. Significance Central banks are investigating potential applications of central bank digital currencies (CBDCs) and this month the Financial Stability Board released its consultative paper on regulating and supervising stablecoins, which are pegged to a traditional asset. Issuance of CBDCs is growing closer. In emerging markets (EMs), they could provide governments with a tool to improve their monetary systems. Impacts Digital currencies can give central banks ‘precision monetary policy’ by bypassing intermediaries and targeting sectors or groups. The COVID-19 pandemic highlights the health advantage that digital money has over 'dirty' banknotes. Digital currencies will lower the cost of remittances to emerging nations but over years rather than months as barriers need to be overcome.

Independent Agencies, Distribution, and Legitimacy: The Case of Central Banks

2019 ◽  
Vol 114 (2) ◽  
pp. 591-595
Author(s):  
PETER DIETSCH
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Policy Making ◽  
Central Banks ◽  
Institutional Arrangements ◽  
The Other ◽  
Trade Offs ◽  
The One ◽  
Alternative Solutions

Delegation to independent agencies can reap real benefits for policy-making. In the case of monetary policy, it shores up the credibility of the central bank. However, the discretion of IAs needs to be constrained to ensure their legitimacy. This letter focuses on one potential constraint, namely, the idea that IAs should not make choices on distributional trade-offs. Given that monetary policy today has significant distributive consequences, if this constraint were respected, the independence of central banks would have to be repealed. This would be just as undesirable as a monetary policy whose distributive consequences remain unchecked. Instead, this letter encourages the search for alternative solutions and puts forward three possible institutional arrangements to manage the tension between the distributive consequences of monetary policy on the one hand and central bank legitimacy on the other.

scholarly journals Digital currency of central banks and monetary policy

2020 ◽  
Vol 2020 (10) ◽  
pp. 64-80
Author(s):  
Oleksandr LYUBICH ◽  
◽  
Gennadiy BORTNIKOV ◽  
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Financial Stability ◽  
Personal Data ◽  
Central Banks ◽  
Goods And Services ◽  
Digital Money ◽  
The Media ◽  
The Right ◽  
Media Channels

The purpose of the study is to determine the potential impact of the introduction of central bank digital currencies (CBDC) on monetary policy. In this paper , we would like to focus on two aspects: the need to save cash in circulation and the potential danger of private digital money for monetary policy. Central bank researchers and independent experts are paying much attention to the CBDC . The reasons are such preconditions as innovations in payment instruments, blockchains, cryptography, globalization in response to the growth of demand for transactions using digital currencies with expected increase in their impact on monetary stability. One of the potential threats to an effective monetary policy is the emergence of private digital money and the risk of failing to choose the right CBDC business model. The development of private digital currencies can significantly reduce income of central banks from seigniorage, weaken the influence of central banks on financial stability and sustainability of monetary policy. Cashless payments, unlike cash, store information about the sender and the recipient, size, date and destination. This information is already a commodity that sellers of financial products and suppliers of goods and services from the real sector are willing to pay for. Cash allows to make payments with greater benefits for the population, taking into account the reliability, comfort and confidentiality. In our opinion, ‘social distancing’ encourages contacts between people through the media channels, with dissemination of knowledge among the general public about digitalisation and convince indiviuals to agree on disclosure of personal data. Central banks are called upon to further develop the money supply management mechanism, to ensure the coexistence of non-cash and cash in their jurisdictions.

Monetary Policy Implications of Electronic Money

First Monday ◽  
1997 ◽  
Author(s):  
Aleksander Berentsen
Keyword(s):  
Central Bank ◽  
Banking System ◽  
Central Banks ◽  
Policy Implications ◽  
Electronic Payment ◽  
Electronic Money ◽  
Regulatory Policies ◽  
Digital Money ◽  
Payment Mechanisms ◽  
Retail Payments

The term digital money refers to various proposed electronic payment mechanisms designed for use by consumers to make retail payments. Digital money products have the potential to replace central bank currency, thereby affecting the money supply. This paper studies the effect of replacing central bank currency on the narrowly defined stock of money under various assumptions regarding regulatory policies and monetary operations of central banks and the reaction of the banking system.

A Theory of Collateral for the Lender of Last Resort*

2021 ◽  
Author(s):  
Dong Beom Choi ◽  
João A C Santos ◽  
Tanju Yorulmazer
Keyword(s):  
Central Bank ◽  
Spillover Effects ◽  
Central Banks ◽  
Counterparty Risk ◽  
Lender Of Last Resort ◽  
Negative Effects ◽  
High Quality ◽  
Money Markets ◽  
Trade Offs ◽  
Lending Policy

Abstract We consider a macroprudential approach to analyze the optimal lending policy for the central bank, focusing on spillover effects that policy exerts on money markets. Lending against high-quality collateral protects central banks against losses, but can adversely affect liquidity creation in markets since high-quality collateral gets locked up with the central bank rather than circulating in markets. Lending against low-quality collateral creates counterparty risk but can improve liquidity in markets. We illustrate the optimal policy incorporating these trade-offs. Contrary to what is generally accepted, lending against high-quality collateral can have negative effects, whereas it may be optimal to lend against low-quality collateral.

EVOLUTION OF DIGITAL CURRENCIES OF CENTRAL BANKS OF THE FUTURE OR THE NEW BRETTON WOODS 2.0

2021 ◽  
Vol 3 (10) ◽  
pp. 27-35
Author(s):  
E. V. Zenkina ◽  
◽  
A. S. Kharlanov ◽  
Keyword(s):  
Central Bank ◽  
Practical Importance ◽  
Central Banks ◽  
Bretton Woods ◽  
Digital Currency ◽  
Digital World ◽  
Payment Instruments ◽  
The Future ◽  
Digital Money ◽  
The Moment

The relevance and importance of the article is due to the increasing practical importance of the evolution of the digital currencies of the central banks of the future due to the fact that globalization requires new payment instruments. We analyzed the understanding of the essence of money and its future, the reasons for the appearance, features and risks of the digital currency of the central bank. Recommendations are proposed to change the functions of national banks, in the field of the need to make digital money of central banks anonymous and facilitate payment by them. It was concluded that at present the digital currency of the central bank is a fashionable answer to the transition to the new digital world, but at the moment it is losing competition to cryptocurrencies.

scholarly journals Central Bank Digital Currency (CBDC) Sebagai Alat Pembayaran di Indonesia

2021 ◽  
Vol 4 (6) ◽  
pp. 2243
Author(s):  
Claudia Saymindo Emanuella
Keyword(s):  
Central Bank ◽  
Cyber Security ◽  
Legal Framework ◽  
Central Banks ◽  
Security Sector ◽  
Digital Currency ◽  
Payment Instruments ◽  
Digital Money ◽  
The Right

AbstractTechnological developments encourage innovation in various sectors, including banking. The widespread use of digital currencies is an impetus for central banks to create an alternative to replace ungoverned digital currencies. Central Bank Digital Currency (CBDC) is the alternative chosen by various central banks in the world. Various countries have conducted research related to the implementation in terms of design and risk in the financial, operational, and legal fields. Bank Indonesia plans to develop a CBDC as part of national economy and finance digitalization. Indonesia does not yet have a strong legal framework to underlie the implementation of CBDC, especially in the cyber security sector, The role of the central bank becomes very important in CBDC’s issuance and implementation as the only party that has the right to determine, issue, and regulate legal payment instruments in Indonesia.Keywords: Central Bank Digital Currency; Digital Money; Central Bank; Cybersecurity.AbstrakPerkembangan teknologi mendorong inovasi dalam berbagai sektor, termasuk perbankan. Maraknya penggunaan digital currency menjadi dorongan bagi bank sentral untuk menciptakan mata uang digital yang dapat menggantikan digital currency tanpa pihak berwenang. Central Bank Digital Currency (CBDC) menjadi alternatif yang dipilih oleh berbagai bank sentral di dunia, dan berbagai negara telah melakukan riset terkait penerapan CBDC dari sisi desain dan risiko di bidang finansial, operasional, dan legal. Bank Indonesia berencana untuk mengembangkan CBDC di Indonesia sebagai bagian dari digitalisasi ekonomi dan keuangan nasional. Indonesia belum memiliki kerangka hukum yang kuat untuk mendasari penerapan CBDC, terutama dalam bidang keamanan siber, mengingat banyaknya ancaman keamanan siber canggih yang terus berkembang. Peran bank sentral menjadi sangat penting dalam penerbitan dan penerapannya sebagai satu-satunya pihak yang berhak menentukan, menetapkan, menerbitkan, dan meregulasi alat pembayaran sah di Indonesia.Kata Kunci: Central Bank Digital Currency; Uang Digital; Bank Sentral; Cybersecurity.

The Effects of Decision Time on Perceptions of Decisions and Decision Makers in (Moral) Trade-Off Scenarios

2019 ◽  
Author(s):  
Anna Katharina Spälti ◽  
Mark John Brandt ◽  
Marcel Zeelenberg
Keyword(s):  
Decision Process ◽  
Decision Time ◽  
Decision Makers ◽  
Process Information ◽  
Total N ◽  
Trade Off ◽  
Financial Gain ◽  
Trade Offs ◽  
Sacred Values ◽  
Moral Context

People often have to make trade-offs. We study three types of trade-offs: 1) "secular trade-offs" where no moral or sacred values are at stake, 2) "taboo trade-offs" where sacred values are pitted against financial gain, and 3) "tragic trade-offs" where sacred values are pitted against other sacred values. Previous research (Critcher et al., 2011; Tetlock et al., 2000) demonstrated that tragic and taboo trade-offs are not only evaluated by their outcomes, but are also evaluated based on the time it took to make the choice. We investigate two outstanding questions: 1) whether the effect of decision time differs for evaluations of decisions compared to decision makers and 2) whether moral contexts are unique in their ability to influence character evaluations through decision process information. In two experiments (total N = 1434) we find that decision time affects character evaluations, but not evaluations of the decision itself. There were no significant differences between tragic trade-offs and secular trade-offs, suggesting that the decisions structure may be more important in evaluations than moral context. Additionally, the magnitude of the effect of decision time shows us that decision time, may be of less practical use than expected. We thus urge, to take a closer examination of the processes underlying decision time and its perception.

scholarly journals Using Deliberative Democracy for Better Urban Decision-Making through Integrative Thinking

Urban Science ◽  
2020 ◽  
Vol 5 (1) ◽  
pp. 3
Author(s):  
Janette Hartz-Karp ◽  
Dora Marinova
Keyword(s):  
Decision Making ◽  
Case Studies ◽  
Deliberative Democracy ◽  
Decision Makers ◽  
Capital City ◽  
City Region ◽  
Multiple Sources ◽  
Trade Offs ◽  
Urban Issues ◽  
Sustainability Challenges

This article expands the evidence about integrative thinking by analyzing two case studies that applied the collaborative decision-making method of deliberative democracy which encourages representative, deliberative and influential public participation. The four-year case studies took place in Western Australia, (1) in the capital city Perth and surrounds, and (2) in the city-region of Greater Geraldton. Both aimed at resolving complex and wicked urban sustainability challenges as they arose. The analysis suggests that a new way of thinking, namely integrative thinking, emerged during the deliberations to produce operative outcomes for decision-makers. Building on theory and research demonstrating that deliberative designs lead to improved reasoning about complex issues, the two case studies show that through discourse based on deliberative norms, participants developed different mindsets, remaining open-minded, intuitive and representative of ordinary people’s basic common sense. This spontaneous appearance of integrative thinking enabled sound decision-making about complex and wicked sustainability-related urban issues. In both case studies, the participants exhibited all characteristics of integrative thinking to produce outcomes for decision-makers: salience—grasping the problems’ multiple aspects; causality—identifying multiple sources of impacts; sequencing—keeping the whole in view while focusing on specific aspects; and resolution—discovering novel ways that avoided bad choice trade-offs.

Sign in / Sign up

Export Citation Format

Share Document