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Cybersecurity risks and central banks’ sentiment on central bank digital currency: Evidence from global cyberattacks

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  • Tian, Shu
  • Zhao, Bo
  • Olivares, Resi Ong

Abstract

This paper distinguishes two types of cybersecurity risks—emerging risks from the private sector and systematic risks to the financial system—and examines their impacts on central banks’ sentiment on CBDC in a context of global cyberattacks. We find that central banks’ sentiment toward CBDC shifted positively following increased losses from cyberattacks on crypto assets, which implies that central banks believe CBDC could be a public solution to protect consumers from risks arising from the private sector. However, their sentiment toward CBDC significantly declined following more active cyberwarfare attacks, which could pose systematic risks to the national financial system.

Suggested Citation

  • Tian, Shu & Zhao, Bo & Olivares, Resi Ong, 2023. "Cybersecurity risks and central banks’ sentiment on central bank digital currency: Evidence from global cyberattacks," Finance Research Letters, Elsevier, vol. 53(C).
    • Handle: RePEc:eee:finlet:v:53:y:2023:i:c:s1544612322007851
    DOI: 10.1016/j.frl.2022.103609
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    More about this item

    Keywords

    Cyberattacks; Cybersecurity risks; Central bank digital currency; Crypto assets;
    All these keywords.

    JEL classification:

    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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