As Benjamin M. Friedman (1999) has pointed out it is possible, albeit at present highly unlikely, that e-money could be used as a means of payment as well as settlement and therefore erode the role of currency and reduce banknotes and coin in circulation.
Friedman also stated that the size of base money (currency in circulation plus the balances of banks at the central bank) could decline in future because of the declining role of banks in advancing credit to the non-bank private sector. If bank credit extension to the private sector decreases, less deposits are created.