The great illusion of digital currencies

Show full item record

Title: The great illusion of digital currencies
Author: Grym, Aleksi
Organization: Bank of Finland
Suomen Pankki
Series: BoF Economics Review
Series number: 1/2018
Year of publication: 2018
Publication date: 21.6.2018
Pages: 18
Subject (yso): raha; sähköinen raha
Keywords: virtuaalivaluutta; kryptovaluutta; elektroninen raha
Abstract: This paper is an analysis of digital currencies, including cryptocurrencies, and their potential as monetary instruments. The analysis shows that the concept of a digital currency is a fallacy. Currency, in the form of coins and banknotes, can be viewed as a physical representation of a monetary unit of account. Currency cannot be digitised, as this would inevitably mean creating a financial record keeping system based on accounts. Cryptocurrencies are not currencies at all but accounting systems for non-existent assets. Central bank digital currency would practically mean bank accounts at the central bank. Whether the general public should have access to such accounts, and whether monetary transactions should be allowed to be made anonymously or privately, are questions of policy and unrelated to cryptocurrencies or their underlying technology.

Files in this item

Total number of downloads: Loading...

Files Size Format View
BoFER_1_2018.pdf 395.3Kb PDF View/Open

This item appears in the following Collection(s)

Show full item record