Strategic digitization in currency and payment competition

• 成果类型: Article
• 署名作者: Cong, Lin William; Mayer, Simon
• 署名单位: Cornell University; National Bureau of Economic Research; Carnegie Mellon University
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2025.104055
• 发表日期: 2025
• 关键词: CBDC; Digital currency; money; Payment innovation; Stablecoins

摘要

We model the competition between digital forms of fiat money and private digital money. Countries digitize their currencies-by upgrading existing or launching new payment systems (including CBDCs)-to compete with foreign fiat currencies and private digital money. A pecking order emerges: less dominant currencies digitize earlier, reflecting a first-mover advantage; dominant currencies delay digitization until they face competition; the weakest currencies forgo digitization. However, delayed digitization allows private digital money to gain widespread adoption, eventually weakening fiat money's role. We highlight how geopolitical considerations, stablecoins, and interoperability between fiat and private digital money shape the dynamics of currency competition.