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Blockchain Technology and Systemic Risk

Author

Listed:
  • Aymen Mselmi

    (College of Business, University of Jeddah, Saudi Arabia)

Abstract

This paper examines the effect of financial institutions management information system migration to blockchain technology on systemic risk. Our study examines a sample of 40 financial institutions around the world. The aim is to identify to what extent the migration of financial company management information system to blockchain system contribute to minimize systemic risk measures through regressions on panel data. We have reached the empirical evidence which indicates that the change we mentioned earlier affect immediately the systemic risk level. Companies that have adopted the blockchain technology recorded a significant reduction in systemic risk level. In addition, financial institutions that have adopted this latter system recorded a significant decrease in long-run marginal expected shortfall and systemic risk index.

Suggested Citation

  • Aymen Mselmi, 2020. "Blockchain Technology and Systemic Risk," International Journal of Economics and Financial Issues, International Journal of Economics and Financial Issues, vol. 10(2), pages 53-60.
    • Handle: RePEc:eco:journ1:2020-02-7
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    References listed on IDEAS

    as
    1. Lin William Cong & Zhiguo He, 2019. "Blockchain Disruption and Smart Contracts," The Review of Financial Studies, Society for Financial Studies, vol. 32(5), pages 1754-1797.
    2. repec:fip:fedhpr:y:2010:i:may:p:65-71 is not listed on IDEAS
    3. Neil Gandal & Hanna Halaburda, 2016. "Can We Predict the Winner in a Market with Network Effects? Competition in Cryptocurrency Market," Games, MDPI, vol. 7(3), pages 1-21, July.
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    5. Viral V. Acharya & Lasse H. Pedersen & Thomas Philippon & Matthew Richardson, 2017. "Measuring Systemic Risk," The Review of Financial Studies, Society for Financial Studies, vol. 30(1), pages 2-47.
    6. Aymen Mselmi & Boutheina Regaieg, 2018. "Corporate governance and systemic risk of Tunisian banks," International Journal of Corporate Governance, Inderscience Enterprises Ltd, vol. 9(1), pages 23-51.
    7. Easley, David & O'Hara, Maureen & Basu, Soumya, 2019. "From mining to markets: The evolution of bitcoin transaction fees," Journal of Financial Economics, Elsevier, vol. 134(1), pages 91-109.
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    Cited by:

    1. Cong Gu & Benfu Lv & Ying Liu & Geng Peng, 2021. "The Impact of Quantitative Easing on Cryptocurrency," International Journal of Economics and Financial Issues, International Journal of Economics and Financial Issues, vol. 11(4), pages 27-34.
    2. Olufemi Peter Alawode & Helen Nwobodo & Afolake Ogunfowora & Alao Olubunmi & Chimeruo Victory Onyeka-Iheme, 2024. "Financial Re-Engineering and Customer Performance of Poultry Business in Nigeria," International Journal of Economics and Financial Issues, International Journal of Economics and Financial Issues, vol. 14(6), pages 164-173, October.

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    Keywords

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    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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