IDEAS home Printed from https://ideas.repec.org/a/eee/intfin/v88y2023ics1042443123001099.html
   My bibliography  Save this article

Evaluation of sight deposits and central bank digital currency

Author

Listed:
  • Azzone, Michele
  • Barucci, Emilio

Abstract

We provide a market-based evaluation of sight deposits of banks when Central Bank Digital Currency (CBDC) is issued. We investigate the effects of different adoption rates (moderate, large or capped adoption), of different remuneration schemes and of the possibility of a bank-run. We perform the analysis at the aggregate level for the Euro area and the United States. We show that the effect of CBDC on deposit market value is small unless a large adoption rate is considered. The remuneration scheme plays a significant role only in the moderate/capped adoption scenario in relative terms and in a high interest rate environment. Instead, the possibility of a bank-run calibrated on the experience of the Euro area and of Greece during the debt crisis has little effect on the value of deposits even if a CBDC is introduced.

Suggested Citation

  • Azzone, Michele & Barucci, Emilio, 2023. "Evaluation of sight deposits and central bank digital currency," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 88(C).
    • Handle: RePEc:eee:intfin:v:88:y:2023:i:c:s1042443123001099
    DOI: 10.1016/j.intfin.2023.101841
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1042443123001099
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.intfin.2023.101841?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:intfin:v:88:y:2023:i:c:s1042443123001099. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/intfin .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.