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Financial and Monetary Stability Aspects of Global Stablecoins

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Schäfer, S., Read, O. Financial and Monetary Stability Aspects of Global Stablecoins. Credit and Capital Markets – Kredit und Kapital, 53(2), 159-185. https://doi.org/10.3790/ccm.53.2.159
Schäfer, Stefan and Read, Oliver "Financial and Monetary Stability Aspects of Global Stablecoins" Credit and Capital Markets – Kredit und Kapital 53.2, 2020, 159-185. https://doi.org/10.3790/ccm.53.2.159
Schäfer, Stefan/Read, Oliver (2020): Financial and Monetary Stability Aspects of Global Stablecoins, in: Credit and Capital Markets – Kredit und Kapital, vol. 53, iss. 2, 159-185, [online] https://doi.org/10.3790/ccm.53.2.159

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Financial and Monetary Stability Aspects of Global Stablecoins

Schäfer, Stefan | Read, Oliver

Credit and Capital Markets – Kredit und Kapital, Vol. 53 (2020), Iss. 2 : pp. 159–185

2 Citations (CrossRef)

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Prof. Dr. Stefan Schäfer, Professor of Economics, Wiesbaden Business School, Hochschule RheinMain University of Applied Sciences, Bleichstraße 44, 65183 Wiesbaden, Germany

Prof. Dr. Oliver Read, Professor of Finance, Wiesbaden Business School, Hochschule RheinMain University of Applied Sciences, Bleichstraße 44, 65183 Wiesbaden, Germany

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References

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Abstract

Global stablecoins (GSCs) like Facebook’s Libra could prove much more instable than they might appear at first sight. Not only can their exchange rates against individual fiat currencies fluctuate substantially; theoretically, they also have the potential to replace national currencies, constitute “digital currency areas” and become the basis of a two-tier banking system with one and more GSC issuers, on the one hand, and, on the other hand, commercial banks that can create GSC deposit money. Against that background, all steps taken so far by supervisors and central banks can only be the starting point of what is necessary to effectively regulate the new normal of the world of money that is emerging.