Tag Archives: Electronic money

On their blog, Stephen Cecchetti and Kermit Schoenholtz voice doubts regarding the usefulness of universal central bank digital currency (U-CBDC). They argue: … in an effort to retain their deposit base, commercial banks would surely raise the interest rate they offer to their customers relative to the rate on U-CBDC. … the introduction of U-CBDC would cause a substantial fraction of deposits to shift to the central bank, with the remainder prone to exit in a period of financial stress. …...

Kontantupproret (“cash rebellion”) in Sweden—not everybody is pleased with the prospect of a cashless society. David Crouch reports in The Guardian.

In: Thomas Moser, Carlos Lenz, Marcel Savioz and Dirk Niepelt, editorial committee, Monetary Economic Issues Today, Festschrift in Honour of Ernst Baltensperger, Swiss National Bank/Orell Füssli, Zürich, June 2017. PDF of draft. The sovereign money initiative (Vollgeldinitiative) seeks to gain greater control over the money and credit supply, to increase financial stability and to achieve a fairer distribution of seigniorage income. The initiative’s suggested approach – a ban on active...

In the NZZ, Jürg Müller reports about the developing regulatory framework for fintechs in Switzerland. A proposal by the federal finance department drew—reasonable—criticism by various lobbies and industry associations, including the CFA Society Switzerland. Die CFA Society Switzerland will das systemrelevante Bankensystem von anderen Finanzdienstleistern trennen. Dafür sei eine präzisere Bankendefinition nötig, als sie heute vorgenommen werde. Nur Banken sollen demnach dem Bankengesetz...

The Swiss National Bank held its annual general meeting of shareholders (web TV). In response to one of the questions posed by shareholders Thomas Jordan suggested (2:58–2:59) that possibly a digital Swiss Franc might be introduced sometime in the future. Tags: Digital currency,Electronic money,Featured,M0 base...

The Swiss National Bank held its annual general meeting of shareholders (web TV). In response to one of the questions posed by shareholders Thomas Jordan suggested (2:58–2:59) that possibly a digital Swiss Franc might be introduced sometime in the future.

In another excellent post on Moneyness, J P Koning likens the monetary system to the plot in the movie Inception, featuring a dream piled on a dream piled on a dream piled on a dream. Koning explains that [l]ike Inception, our monetary system is a layer upon a layer upon a layer. Anyone who withdraws cash at an ATM is ‘kicking’ back into the underlying central bank layer from the banking layer; depositing cash is like sedating oneself back into the overlying banking layer. Monetary...

In the FT, David Pilling reports about Somalia which has managed without central bank issued money for decades. … up to 98 per cent of local banknotes are fake … With the help of the International Monetary Fund, Mogadishu plans to print official banknotes for the first time in more than a quarter of a century … No official Somali currency has left the presses since the Horn of Africa nation descended into clan warfare after the collapse of the government in 1991. … warlords, businessmen...

In the Welt, Karsten Seibel reports about the Bundesbank pondering over digital money. The Riksbank does the same.

In the FT, Richard Milne reports about the Riksbank pondering to issue a digital currency. There are considerable questions for Sweden’s central bank to answer about how a digital currency would work. Would individuals have an account at the Riksbank? Would transactions be traceable, unlike with cash? Would emoney earn interest? Ms Skingsley said: “Personally I would like to design it in a way that is most like notes and coins.” That would mean no interest would be paid on it. But she...