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From cash to private and public digital currencies. The risk of financial instability and “modern monetary Middle agesâ€

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  • Ansgar Belke
  • Edoardo Beretta

Abstract

The article analyzes the unstable equilibrium between further developing national monetary systems by means of (private/public) digital currencies while maintaining financial stability as secured by “tangible†store of values like notes/coins. Which are those elements of innovation improving today’s payments system? And, at the same time, which modern trends might destabilize the above-mentioned equilibrium? The paper will identify fundamental monetary principles to be respected, no matter what the innovation level in post-modern economies might soon look like. Cryptocurrencies will be also compared to central bank digital currencies (CBDC), which might soon complement or even replace notes and coins. But, is cash truly a “barbarous relic†? And, which impact might have its legal limitation (as occurring in several European countries)?

Suggested Citation

  • Ansgar Belke & Edoardo Beretta, 2020. "From cash to private and public digital currencies. The risk of financial instability and “modern monetary Middle agesâ€," Economics and Business Letters, Oviedo University Press, vol. 9(3), pages 189-196.
    • Handle: RePEc:ove:journl:aid:14743
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    File URL: https://reunido.uniovi.es/index.php/EBL/article/view/14743
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    References listed on IDEAS

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    1. Ansgar Belke & Edoardo Beretta, 2020. "From cash to central bank digital currencies and cryptocurrencies: a balancing act between modernity and monetary stability," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 47(4), pages 911-938, June.
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    12. Belke, Ansgar & Beretta, Edoardo, 2019. "From cash to central bank digital currencies and cryptocurrencies: A balancing act between modernity and monetary stability," Ruhr Economic Papers 816, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
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