The both sides. On the benefits and drawbacks of central bank digital currencies
The both sides. On the benefits and drawbacks of central bank digital currencies

Author(s): Paweł Marszałek
Subject(s): Economy, National Economy, Economic policy, Government/Political systems, Economic development
Published by: Wydawnictwo Uniwersytetu Ekonomicznego w Poznaniu
Keywords: central banks;cryptocurrencies;digital currencies;financial inclusion;monetary policy;technology;
Summary/Abstract: Purpose: Analysing the most frequently pointed out advantages and disadvantages of central bank digital currencies. The analysis will make it possible to draw up a balance of the potential introduction of CBDCs. Methodology: The paper surveys literature and documents of selected financial. Findings: The balance of the benefits and drawbacks of CBDCs is not obvious. First, due to the heterogeneity of conditions in individual countries and the multitude of variants, CBDCs are far from universal. Second, the advantages of CBDCs seem to be somewhat exaggerated: many of them can be achieved using existing institutional solutions or payment technologies, while some are rather wishful thinking. Third, there are contradictions between the various advantages and uses of CBDCs. Fourth, many of the advantages of CBDCs cannot be achieved without a top-down ban on paper money, which is neither desirable nor socially justifiable.

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