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The Future of Money: Central Bank Digital Currencies

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  • Michael Lloyd

    (Global Policy Institute)

Abstract

This paper examines the rationale behind the exploration by the vast majority of central banks of introducing central bank digital currencies. This phenomenon is discussed in the context of the main drivers of central bank interest, the crucial role of public money in supporting and complementing private money channels, the role of digital ledger technology in facilitating the delivery of both wholesale and retail central bank digital currencies, and innovation in the forms of money that this enterprise represents. The implications for domestic and international monetary system architectures in the immediate, short-term, and long-term will be discussed. It will be argued that the delivery of central bank digital currencies represents an important development in the future of money, and requires agreement of the public following a wide-ranging debate at all levels in society.

Suggested Citation

  • Michael Lloyd, 2022. "The Future of Money: Central Bank Digital Currencies," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 50(3), pages 85-98, December.
    • Handle: RePEc:kap:atlecj:v:50:y:2022:i:3:d:10.1007_s11293-022-09748-3
    DOI: 10.1007/s11293-022-09748-3
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    References listed on IDEAS

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    1. Markus K. Brunnermeier & Harold James & Jean-Pierre Landau, 2019. "The Digitalization of Money," Working Papers 2019-13, Princeton University. Economics Department..
    2. Jan Kregel, 2021. "The Economic Problem: From Barter to Commodity Money to Electronic Money," Economics Working Paper Archive wp_982, Levy Economics Institute.
    3. Skylar Brooks, 2021. "Revisiting the Monetary Sovereignty Rationale for CBDCs," Discussion Papers 2021-16, Bank of Canada.
    4. Arslanalp, Serkan & Eichengreen, Barry & Simpson-Bell, Chima, 2022. "The stealth erosion of dollar dominance and the rise of nontraditional reserve currencies," Journal of International Economics, Elsevier, vol. 138(C).
    5. Mr. Serkan Arslanalp & Mr. Barry J. Eichengreen & Chima Simpson-Bell, 2022. "The Stealth Erosion of Dollar Dominance: Active Diversifiers and the Rise of Nontraditional Reserve Currencies," IMF Working Papers 2022/058, International Monetary Fund.
    6. Li, Jiaqi, 2023. "Predicting the demand for central bank digital currency: A structural analysis with survey data," Journal of Monetary Economics, Elsevier, vol. 134(C), pages 73-85.
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