The Monetary Turning Point: From Bank Money to Central Bank Digital Currency (CBDC)

The monetary system is transitioning to a Central Bank Digital Currency (CBDC) regime, which will compete with existing bank money and private cryptocurrencies. CBDC has superior properties, but bank money will not be able to emulate them due to technological and political reasons. Uncovered and unwarranted cryptocurrencies will not stand the competition in the long run, changing the role of central banks in monetary policy. The book is of interest to academics, researchers, and policymakers in monetary and financial economics, and digital currencies.

Format: Hardback
Length: 192 pages
Publication date: 18 February 2023
Publisher: Springer International Publishing AG

The monetary system is undergoing a significant transformation, with the question now shifting from if to how soon countries will introduce Central Bank Digital Currencies (CBDCs). This comprehensive book delves into the reimagining of the money supply, transitioning from the current bank money regime to a monetary system driven by CBDCs. As the book unfolds, it becomes evident that the future of money will be digital and sovereign, marking a paradigm shift in the financial landscape. However, it is important to note that the relationship between different types of money will be characterized by competition rather than the harmonious coexistence initially envisioned. CBDCs will directly rival both incumbent bank money and private cryptocurrencies, posing challenges to both central-bank money and bank money.

For technological and political reasons, bank money will struggle to replicate the superior properties of sovereign digital tokens. Uncovered and unwarranted cryptocurrencies, likewise, will not be able to withstand the long-term competition. The shifts in the monetary system are reshaping the roles of central banks in the interplay of monetary, fiscal, and private-creditary functions, presenting new opportunities for monetary policy. This book will appeal to academics, researchers, and policymakers in the fields of monetary and financial economics, as well as digital currencies, as it offers valuable insights into the evolving monetary landscape.

Weight: 402g
Dimension: 210 x 148 (mm)
ISBN-13: 9783031239564
Edition number: 1st ed. 2023