Designing a Global Digital Currency

42 Pages Posted: 9 Oct 2017 Last revised: 19 Oct 2017

See all articles by Ronald J. Balvers

Ronald J. Balvers

McMaster University - Michael G. DeGroote School of Business

Bill McDonald

University of Notre Dame - Mendoza College of Business - Department of Finance

Date Written: October 6, 2017

Abstract

The notion of a global currency is a debate set aside in the past decade as the abstraction saw little potential for realization in a world with heterogeneous governments unwilling to sacrifice seigniorage for optimal design. The technical capability of creating digital currencies, independent of governments, resurrects the discussion and begs the questions of practical design and implementation. We discuss the characteristics of an ideal global currency and consider empirically the factors a cryptocurrency might use to create a portfolio mimicking the ideal design.

Keywords: Global currencies; digital currencies; cryptocurrencies; currency design; Bitcoin, Ethereum

JEL Classification: E4; E42, E31; F3382; D83; G14; G18; G30; M40; M41

Suggested Citation

Balvers, Ronald J. and McDonald, Bill, Designing a Global Digital Currency (October 6, 2017). Available at SSRN: https://ssrn.com/abstract=3049000 or http://dx.doi.org/10.2139/ssrn.3049000

Ronald J. Balvers

McMaster University - Michael G. DeGroote School of Business ( email )

1280 Main Street West
Hamilton, Ontario L8S 4M4
Canada
(905) 525-9140 x23969 (Phone)

HOME PAGE: http://profs.degroote.mcmaster.ca/business/balvers

Bill McDonald (Contact Author)

University of Notre Dame - Mendoza College of Business - Department of Finance ( email )

P.O. Box 399
Notre Dame, IN 46556-0399
United States

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