Cryptocurrencies: policy, economics and fairness

Danielsson, Jon ORCID: 0009-0006-9844-7960 (2018) Cryptocurrencies: policy, economics and fairness. Systemic Risk Centre Discussion Papers (86). Systemic Risk Centre, The London School of Economics and Political Science, London, UK.

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Abstract

Cryptocurrencies promise to replace fiat money with private money whose integrity is underpinned by algorithms, not government guarantees. While the technology is elegant, the success and failure of cryptocurrencies in the competition with fiat will not be determined by technology alone. What is more important is that any serious economic and social consequences be avoided. A cryptocurrency based monetary system would suffer from persistent deflation and higher systemic risk than existing fiat systems, and would exasperate inequality. If, however, cryptocurrencies cannot replace existing fiat money, their terminal value is zero.

Item Type:	Monograph (Discussion Paper)
Official URL:	https://www.systemicrisk.ac.uk/
Additional Information:	© 2018 The Author
Divisions:	Finance
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HG Finance
JEL classification:	G - Financial Economics > G0 - General > G00 - General E - Macroeconomics and Monetary Economics > E4 - Money and Interest Rates > E42 - Monetary Systems; Standards; Regimes; Government and the Monetary System
Date Deposited:	31 May 2023 10:48
Last Modified:	11 Dec 2024 19:45
URI:	http://eprints.lse.ac.uk/id/eprint/118913

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