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Theoretical Analysis and Review of The Impact of Central Bank Digital Money (CBDC) On Monetary Policies, Improvement of Central Bank Supervision and Financial Stability Based on The Experience of Other Countries
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Abdolnaser Hemmati *1   , Parisa Jamali1 |
| 1- University of Tehran |
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Abstract: (116 Views) |
With the emergence of private digital currencies and the decreasing use of cash, the discussion about the issuance of Central Bank Digital Currency (CBDC) among central banks has gained momentum. Considering the interest of central banks worldwide in CBDC, we endeavored to analyze other countries' initiatives in introducing CBDC through a comparative analysis method, aiming to examine its impact on monetary policies, improving central bank supervision, and financial stability. For this purpose, we considered the most probable design of CBDC that central banks are inclined to adopt. The results indicate that the issuance of CBDC, with the condition of appropriate design and necessary actions by the central bank, not only does not lead to the disintermediation of banks but can also contribute to its improvement. Monetary policy is reinforced with the presence of CBDC, expanding the space for monetary policies through the introduction of new tools such as helicopter money, smart contracts, and the implementation of negative interest rates. In general, central bank digital currency, due to its financial inclusion and the new source of data it provides to the central bank, contributes to financial stability and the improvement of the central bank.
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Article number: 5 |
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Full-Text [PDF 706 kb]
(68 Downloads)
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Type of Study: Theoretical Article |
Subject:
Monetary Policy, Central Banking, and the Supply of Money and Credit (E5)
Received: 2024/01/7 | Accepted: 2024/05/26 | Published: 2024/07/30
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