The Potential Impact of Decentralized Virtual Currency on Monetary Policy

Federal Reserve Bank of Dallas - Globalization and Monetary Policy Institute 2016 Annual Report

6 Pages Posted: 1 Jun 2017

See all articles by Gina C. Pieters

Gina C. Pieters

University of Chicago - Department of Economics; Cambridge Centre for Alternative Finance

Date Written: January 1, 2017

Abstract

One of the most unexpected global monetary developments in the past decade has been the emergence of decentralized virtual currencies. Bitcoin, the largest and best known of the decentralized virtual currencies, has well-documented market properties—including its use as an international vehicle currency. Decentralized virtual currencies are of particular interest to central bankers because eventually they could change administration of monetary policy globally by allowing users to circumvent capital controls and managed exchange rates.

Keywords: Bitcoin, Cryptocurrency, Monetary Policy, Capital Controls, Exchange Rates

Suggested Citation

Pieters, Gina C., The Potential Impact of Decentralized Virtual Currency on Monetary Policy (January 1, 2017). Federal Reserve Bank of Dallas - Globalization and Monetary Policy Institute 2016 Annual Report. Available at SSRN: https://ssrn.com/abstract=2976515

Gina C. Pieters (Contact Author)

University of Chicago - Department of Economics ( email )

1101 East 58th Street
Chicago, IL 60637
United States

Cambridge Centre for Alternative Finance ( email )

10 Trumpington Street
Cambridge, CB21QA
United Kingdom

HOME PAGE: http://https://www.jbs.cam.ac.uk/faculty-research/centres/alternative-finance/

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