While the Geneva report focuses on blockchain’s impact on finance, I will consider the potential broader impact on the economy of central banks issuing new forms of money. Since the general public already holds central bank liabilities in the form of banknotes and coins, this is clearly a question of how. But I will also consider who.
In an environment of excess liquidity and new regulatory requirements for financial market participants, broadening access to the liability side of central banks’ balance sheets to parties other than banks may help better align financial conditions with the central bank’s intended stance.