14 Pages Posted: 23 Sep 2014
Date Written: September 16, 2014
Modern electronic payment systems rely on trusted, central third parties to process payments securely. Recent developments have seen the creation of digital currencies like Bitcoin, which combine new currencies with decentralised payment systems. Although the monetary aspects of digital currencies have attracted considerable attention, the distributed ledger underlying their payment systems is a significant innovation. As with money held as bank deposits, most financial assets today exist as purely digital records. This opens up the possibility for distributed ledgers to transform the financial system more generally.
Suggested Citation: Suggested Citation
Ali, Robleh and Barrdear, John and Clews, Roger and Southgate, James, Innovations in Payment Technologies and the Emergence of Digital Currencies (September 16, 2014). Bank of England Quarterly Bulletin 2014 Q3. Available at SSRN: https://ssrn.com/abstract=2499397