Central Bank Issued Digital Cash

36 Pages Posted: 1 Aug 2018

See all articles by Andreas Furche

Andreas Furche

Capital Markets CRC Limited (CMCRC)

Elvira Sojli

UNSW Australia Business School, School of Banking and Finance

Date Written: April 26, 2018


The emergence of crypto-currencies has spurred a debate on whether central banks should themselves issue currencies in a digitised form. We investigate the technology options available for such implementations today and analyse potential drivers and inhibitors for the successful implementation of a central bank digital currency (CBDC). We conclude that issuing fiat currency as centrally issued digital certificates (CIDC) is the most likely path to success for CBDC. Digital certificates are the most similar technology to issuing physical cash, and they can be secure. CIDC allow for flexible delivery approaches, where the existing economic agents can continue their existing roles. At the same time, it gives the central bank significant additional benefits. These include improved control mechanisms for its outstanding currency, more direct influence and visibility of the circulation of its currency, and improved settlement mechanisms for those dealing in their currencies.

Keywords: cash, cryptocurrencies, digital cash, blockchain, distributed ledger, digital certificates, financial technology

Suggested Citation

Furche, Andreas and Sojli, Elvira, Central Bank Issued Digital Cash (April 26, 2018). Available at SSRN: https://ssrn.com/abstract=3213028 or http://dx.doi.org/10.2139/ssrn.3213028

Andreas Furche

Capital Markets CRC Limited (CMCRC) ( email )

Level 3, 55 Harrington Street
Sydney, 2000

Elvira Sojli (Contact Author)

UNSW Australia Business School, School of Banking and Finance ( email )

Sydney, NSW 2052

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
PlumX Metrics