What are the influences of digital currency?

Digital currency is a double-edged sword. On the one hand, the blockchain technology it relies on has been decentralized and can be used in other fields outside digital currency, which is one of the reasons why Bitcoin is popular; On the other hand, if digital currency is widely used as a currency, it will have a great impact on the effectiveness of monetary policy, financial infrastructure, financial market and financial stability. Specific Wu Xiaoxia:

1, the impact on monetary policy

If digital currency is widely accepted and can play the role of currency, it will weaken the effectiveness of monetary policy and bring difficulties to policy making.

Because issuers in digital currency are usually unregulated third parties, money is created outside the banking system, and circulation depends entirely on the wishes of issuers, which will make the money supply unstable. In addition, the authorities can't monitor the issuance and circulation of digital currency, which will lead to the inability to accurately judge the economic operation, which will bring trouble to policy making and weaken the effectiveness of policy transmission and implementation.

2. Impact on financial infrastructure

The decentralized mechanism of value exchange based on distributed ledger technology has changed the basic settings of total and net settlement on which financial market infrastructure depends. The use of distributed ledger will also bring challenges to trading, clearing and settlement, because it can promote the non-intermediation of traditional service providers in different markets and infrastructures. These changes may have a potential impact on the market infrastructure outside the retail payment system, such as large payment system, securities settlement system or transaction database.

3. The influence on financial intermediaries and financial markets in a broad sense.

If digital currency and the technology based on distributed ledger are widely used, it will bring challenges to the participants in the current financial system, especially the intermediary role of banks. Banks are financial intermediaries, perform the duties of supervisors and supervise borrowers on behalf of depositors.

Usually, banks also carry out liquidity and term conversion business to realize the financing of funds from depositors to borrowers. If digital currency and distributed ledger are widely used, any subsequent disintermediation may have an impact on the savings or credit evaluation mechanism.

4. Security risks and their impact on financial stability.

Assuming that digital currency is recognized by the public, its use is greatly increased, and it replaces legal tender to a certain extent, negative events such as cyber attacks on user terminals related to digital currency will cause currency fluctuations, which will have an impact on financial order and real economy.

In addition, virtual currency based on blockchain technology is usually held by a few people at first. For example, in May of 20 10, BTC bought a $25 pizza for the first time. By the end of 20 13, the price of each bitcoin had risen to 1200 in more than three years.

Extended data

Amazon will launch digital currency project in Mexico.

On the morning of February 1 1, CoinDesk reported that Amazon will launch the digital currency project in Mexico. Amazon is recruiting a software development manager for Digital and Emerging Payments (DEP) to develop a new payment product that enables customers to convert cash into digital currency.

The digital and emerging payment department intends to launch the product in Mexico first. Follow-up actions will be extended to Brazil and India. It is reported that the digital currency project will focus entirely on payment services in emerging markets.

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