Five digital currency questions for central banks - Central Banking
"Central bankers need to take a view on the ongoing disruption to monetary systems, rather than simply expecting the issue will go away, argues Adam Csabay"
Blockchain Startups Are Modernizing Iran's Financial Infrastructure - CoinDesk
The Iranian government is engaging with blockchain startups that are laying what could be the groundwork for a new token ecosystem, CoinDesk has learned.
A world with central bank digital currencies
No universal case exists yet for CBDC. IMF research suggests that the popularity of CBDC and its impact will largely depend on its design features and, while risks exist, policies can be introduced to mitigate the costs and increase the benefits. As IMF Managing Director Christine Lagarde recently said in an influential speech, central banks should “investigate [CBDC] further, seriously, carefully, and creatively.”
Japan’s Central Bank Examines Central Bank Digital Currencies in New Report
"Japan’s central bank has examined the role of central bank digital currencies (CBDCs) in the current monetary system in a report released on Feb. 19. In the document, the bank describes the possible ways to implement a CBDC and the hypothetical consequences of different approaches. The report divides possible CBDCs in two categories, the first being those accessible to the general public in a form like banknotes, and the other as those limited for large-value settlements."
(Research Paper) Digital Innovation, Data Revolution and Central Bank Digital Currency : 日本銀行 Bank of Japan
"Under the developments of digital innovation, global expansion of cashless payments and the emergence of crypto-assets, some argue that central banks should issue digital currencies that can be used by ordinary people instead of paper-based banknotes. The debates on central bank digital currencies are now gathering great attention from worldwide. Although many of major central banks, including the Bank of Japan, do not have an immediate plan to issue digital currencies that can replace banknotes, some central banks are seriously considering whether they should issue digital currencies in the near future or have already issued them as pilot studies. The debates on central bank digital currencies cover broad issues, such as their possible impacts on payment efficiency, banks' fund intermediation, liquidity crises and the transmission mechanism of monetary policy. All of these issues have important implications for the functions of money as well as its future. Digital innovation expands the possibility of money and enables new types of money with a variety of functions to emerge. These functions may include not only traditional payments but also processing various information and data attached to payments as well as executing transactions. In order to consider the pros and cons of central bank digital currencies as well as the future of money, it is needed to assess their possible impacts not only on payment efficiency but also on financial structure and the overall economy. It is also important to examine their impacts on effective utilization of data and the dynamics of "networks externality", which is one of major characteristics of payment infrastructure."
Britain is going cashless without a plan for what happens next — Quartz
"Cash usage is shrinking in the Britain faster than in most places, and the debate about what to do about it is getting louder. That’s important because, like just about every country where digital payments are taking over, the UK doesn’t have much of a plan for what happens next."
Central banks disagree over cash regulation - Central Banking
"There is a lack of consensus around what role central banks should take in regulating the future of cash, according to a panel of experts. Speaking on a panel at the Future of Cash conference, central bankers and commercial bankers debated to what extent central banks should get involved in mandating banks and retailers to accept and/or distribute various denominations moving forward. "
Print-your-own banknotes could be the future – DNB official - Central Banking
Members of the public may be able to print their own single-use banknotes with integrated QR codes in the future, the head of the Netherlands Bank’s cash policy department said.
Luxembourg University Postdoc: Central Bank Digital Currencies Too Attractive to Ignore
"The idea of issuing a central bank digital currency (CBDC) is too attractive to ignore, a postdoctoral researcher from the University of Luxembourg wrote in a study. The research was shared by the Oxford Business Law Blog on Friday, Feb. 22. Hossein Nabilou, a postdoctoral researcher at the Faculty of Law, Economics, and Finance of the University of Luxembourg, presented his findings in a study entitled “Central Bank Digital Currencies: Preliminary Legal Observations.” The report focused on potential challenges that launching a CBDC might cause for the European Central Bank (ECB)."
Cryptocurrencies untether the goat of sovereign tender | Financial Times
"The goat standard and the gold standard are identical concepts. In both cases the idea is that money has value because it is in some way associated with a real thing, for which it can be exchanged. However, this “commodity standard” model has now been largely abandoned. Today’s “fiat” currencies derive their value solely from the promises of their sovereign issuers. In effect, what has happened is that we have removed the real goats from the system, and now use only notional goats."
Amazon, Western Union let customers buy in Kenya shillings — Quartz Africa
"The e-commerce giant has rolled out a service that will allow customers to purchase goods and then pay for them at a local Western Union retail agent. During checkout, a special QR code will be generated that will be used to verify the customer’s identity and matched to the order confirmation for payment. Dubbed Amazon PayCode, the cross-border payment option has been launched in Kenya in Africa, along with nine other countries in Asia and Latin America."
China aims for rural areas to go cashless by 2020
"The plan, for rural areas of China to go cashless, appears as in a series of guidelines put together by China’s top financial regulators: China's central bank, the Banking and Insurance Regulatory Commission, the Securities Regulatory Commission, the Ministry of Finance and the Ministry of Agriculture and Rural Affairs. The intention is to ensure that online financial services become more accessible to rural residents."
Saudi Arabia aims to become a ‘cashless society’
"Saudi Arabia aims to reduce the dependence on cash circulation through the continuous development of the national payment infrastructure to facilitate the transition to an electronic payment environment, said Dr Ahmed Abdulkarim Alkholifey, Governer of Saudi Arabian Monetary Agency (Sama)."
Not a Cryptocurrency: Ukraine Completes National Digital Currency Pilot
The National Bank of Ukraine, the country’s central bank, has been working on a pilot project to test the usefulness of a digital version of its currency, the Hryvnia. The bank announced today that it had completed the pilot and would be investigating further uses of the token.
Episode 9: Initial Country Offering – What Grinds My Gears – Medium
"Last week we discussed consumer credit and the questions that remain around decentralized lending systems. This week we are taking on sovereign credit — and specifically what happens when companies and countries start fundraising via tokens instead of debt."
EU weighs new payment rules in challenge to U.S. companies | Reuters
"The European Commission is considering new rules to speed up adaptation of an instant-payment system the European Central Bank introduced last year, challenging card companies and tech giants such as Visa and PayPal."
Marshall Island National Cryptocurrency Blockchain Notes
Marshall Island is among the few countries that have a national cryptocurrency. On Monday, Tangem, a renowned cryptocurrency hardware wallet developer based in Switzerland revealed that it had been selected to print physical blockchain notes for the nation’s upcoming national cryptocurrency.
Saga - Global Digital Currency
"Saga addresses public policy concerns raised by these developments. Non-anonymous and reserve backed, Saga is supported by global subject-matter leaders. Saga sees itself as complementary to the existing financial system."
The Central Bank Identifies Preferred Technology Solutions Provider for Bahamas Digital Currency
"The Central Bank of The Bahamas is pleased to announce the selection of NZIA Limited as the preferred technology solutions provider to design and implement the digital fiat currency system for The Bahamas. "Project Sand Dollar" is the official name for this payments system modernisation initiative. The Bank will commence negotiations with NZIA Limited to agree the final terms and scope of the engagement."
The Bahamas to introduce blockchain central bank digital currency | finder.com.au
""The Central Bank expects that at the conclusion of this project all residents in The Bahamas will have equal, expanded access to modernised digital payments capabilities. A concurrent reduction in cash transactions is also expected. The evolved Bahamian payments infrastructure should reduce service delivery costs, increase transactional efficiency and improve the overall level of financial inclusion in communities throughout the archipelago," the Central Bank explains."
Moneyness: Swish cash and bitcoin
"Swish's success (at the expense of cash) probably isn't solely a function of enlightened consumer choice--it also benefited from a gentle nudge from the Riksbank (and the private sector, who advised the central bank)."
Central bank digital currency: Concepts and trends
So far, however, no central banks have found strong advantages to issuing their own digital coins due to technical constraints. An isolated move is noticeable in the case of Riksbank, which has been considering the issuance of deposit accounts or prepaid payment tools to the general public in the face of declining use of cash.
Money and Central Bank Digital Currency
ECCB to Issue World’s First Blockchain-based Digital Currency – Blog | Bitt
"The Eastern Caribbean Central Bank (ECCB) and the Barbados-based fintech company, Bitt Inc. (Bitt) have signed a contract to conduct a blockchain-issued Central Bank Digital Currency (CBDC) pilot within the Eastern Caribbean Currency Union (ECCU)."
Why the world is awash with $100 bills | Financial Times
"Torsten Slok, Deutsche Bank’s chief international economist, spotted that the volume of hundred-dollar bills in circulation had, according to data compiled by the US Federal Reserve, doubled since 2008, leaving around 12.5 billion of these bills stuffed into wallets, safes and suitcases globally. That’s $1.25tn."
Eastern Caribbean Central Bank to Test Blockchain Legal Tender - CoinDesk
"The pilot is launching this month and, after roughly 12 months of development and testing, will be followed by rollout and implementation in pilot countries for about six months. The ECCB will also launch educational initiatives to raise public engagement with DXCD across the union."
Central Bank Digital Currency and Banking by Jonathan Chiu, Seyed Mohammadreza Davoodalhosseini, Janet Hua Jiang, Yu Zhu :: SSRN
"This paper builds a model with imperfect competition in the banking sector. In the model, banks issue deposits and make loans, and deposits can be used as payment instruments by households. We use the model to assess the general equilibrium effects of introducing central bank digital currency (CBDC). We identify a new channel through which CBDC can improve the efficiency of bank intermediation and increase lending and aggregate output even if its usage is low, i.e., CBDC serves as an outside option for households, thus limiting banks' market power in the deposit market. We then calibrate the model to evaluate the quantitative implication of this channel."
Exclusive: Mexican central bank in talks with Amazon about new mobile payments | Reuters
"Mexico’s central bank is in talks with Amazon.com Inc to launch a new government-backed mobile payment system that would allow consumers to pay for online purchases using QR codes, the bank’s head of payments said."
Philadelphia Is First U.S. City to Ban Cashless Stores
Philadelphia is the first major U.S. city to ban cashless stores, placing it at the forefront of a debate that pits retail innovation against lawmakers trying to protect all citizens’ access to the marketplace.
Marshall Islands Rejects IMF Concerns to Launch 'Sovereign' (SOV) Digital Currency as Legal Tender
Neema, the firm managing the Marshall Islands cryptocurrency program, has made a list of countries potentially open to a cryptocurrency as legal tender, looking for smaller countries that don't have their own currencies and which vote alongside Israel in the United Nations. Neema’s law firm Yigal Arnon & Co are reportedly helping the Marshall Islands central bank to create the legislation needed to operate its own currency.