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Developing central bank digital currencies: a reality check during cryptocurrency euphoria

Author

Listed:
  • Iulia Cioroianu
  • Shaen Corbet
  • Charles Larkin
  • Les Oxley

Abstract

Using estimated sentiment indices based on CBDC-related social media posts, and testing for the effects of regulatory-related announcements upon blockchain and cryptocurrency-related funds, this research presents two key findings: first, the continued evolution of the pricing structures of digital finance products to respond to such perceived threats constitutes a further evolutionary point in the product's life-cycle. However, secondly, the very fact that returns fall while volatility increases, indicates a largely negative market response to the threat of potential external regulation of cryptocurrencies in the future. The nature of this negative response validates concerns that anonymity continues to be a central attractive feature for cryptocurrency stakeholders, further verifying the necessity for third-party oversight.

Suggested Citation

  • Iulia Cioroianu & Shaen Corbet & Charles Larkin & Les Oxley, 2023. "Developing central bank digital currencies: a reality check during cryptocurrency euphoria," Economics and Business Letters, Oviedo University Press, vol. 12(2), pages 105-114.
    • Handle: RePEc:ove:journl:aid:18798
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    File URL: https://reunido.uniovi.es/index.php/EBL/article/view/18798
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    References listed on IDEAS

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    Cited by:

    1. Conlon, Thomas & Corbet, Shaen & Oxley, Les, 2024. "The influence of European MiCa regulation on cryptocurrencies," Global Finance Journal, Elsevier, vol. 63(C).
    2. Akyildirim, Erdinc & Corbet, Shaen & Mukherjee, Abhishek & Ryan, Michael, 2025. "Global perspectives on open banking: Regulatory impacts and market response," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 101(C).
    3. Kyriazis, Nikolaos & Papadamou, Stephanos & Tzeremes, Panayiotis & Corbet, Shaen, 2024. "Quantifying spillovers and connectedness among commodities and cryptocurrencies: Evidence from a Quantile-VAR analysis," Journal of Commodity Markets, Elsevier, vol. 33(C).
    4. Medina Ayta Mohammed & Carmen De-Pablos-Heredero & José Luis Montes Botella, 2025. "Mapping the transformative realm of blockchain-enabled central bank digital currencies: a bibliometric analysis," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 15(1), pages 53-88, March.
    5. Kyriazis, Nikolaos & Corbet, Shaen, 2025. "Understanding the connectedness between US traditional assets and green cryptocurrencies during crises," The North American Journal of Economics and Finance, Elsevier, vol. 80(C).
    6. Peterson K. Ozili, 2025. "How Politics Hinder Central Bank Digital Currency (CBDC) Development and What to Do about It," Journal of Central Banking Theory and Practice, Central bank of Montenegro, vol. 14(1), pages 59-74.

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