CBDC need not pose stability threat – paper

Markus Brunnermeier and Dirk Niepelt say some arguments about CBDCs are “questionable”


The creation of a retail central bank digital currency (CBDC) will not necessarily undermine the stability of the banking sector, say Markus Brunnermeier and Dirk Niepelt in a new paper.

The authors set out a model of money, liquidity and financial frictions in the working paper, published by the US National Bureau of Economic Research.

The framework suggests some “frequently made arguments” about CBDCs are “questionable”, Brunnermeier and Niepelt write.

If the central bank is strongly

To continue reading...

You need to sign in to use this feature. If you don’t have a FX Week account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an indvidual account here: