The Role of Card Acceptance in the Transaction Demand for Money Staff Working Paper 2014-44 Kim Huynh, Philipp Schmidt-Dengler, Helmut Stix The use of payment cards, either debit or credit, is becoming more and more widespread in developed economies. Nevertheless, the use of cash remains significant. Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Digital currencies and fintech, Econometric and statistical methods, Financial services JEL Code(s): C, C3, C35, C8, C83, E, E4, E41
Competition in the Cryptocurrency Market Staff Working Paper 2014-33 Neil Gandal, Hanna Halaburda We analyze how network effects affect competition in the nascent cryptocurrency market. We do so by examining the changes over time in exchange rate data among cryptocurrencies. Content Type(s): Staff research, Staff working papers Topic(s): Digital currencies and fintech JEL Code(s): L, L1
Retail Payment Innovations and Cash Usage: Accounting for Attrition Using Refreshment Samples Staff Working Paper 2014-27 Heng Chen, Marie-Hélène Felt, Kim Huynh We exploit the panel dimension of the Canadian Financial Monitor (CFM) data to estimate the impact of retail payment innovations on cash usage. We estimate a semiparametric panel data model that accounts for unobserved heterogeneity and allows for general forms of non-random attrition. Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Digital currencies and fintech, Econometric and statistical methods, Financial services JEL Code(s): C, C3, C35, E, E4, E41
Understanding the Cash Demand Puzzle Staff Working Paper 2014-22 Janet Hua Jiang, Enchuan Shao We develop a model to explain a puzzling trend in cash demand in recent years: the value of bank notes in circulation as a percentage of GDP has remained stable despite decreasing cash usage at points of sale owing to competition from alternative means of payment such as credit cards. Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Credit and credit aggregates, Digital currencies and fintech JEL Code(s): E, E4, E41, E5, E51
Consumer Cash Usage: A Cross-Country Comparison with Payment Diary Survey Data Staff Working Paper 2014-20 John Bagnall, David Bounie, Kim Huynh, Anneke Kosse, Tobias Schmidt, Scott Schuh, Helmut Stix We measure consumers’ use of cash by harmonizing payment diary surveys from seven countries. The seven diary surveys were conducted in 2009 (Canada), 2010 (Australia), 2011 (Austria, France, Germany and the Netherlands), and 2012 (the United States). Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Digital currencies and fintech, Econometric and statistical methods, Financial services JEL Code(s): D, D1, D12, E, E4, E41, E5, E58
May 13, 2014 Understanding Platform-Based Digital Currencies Bank of Canada Review - Spring 2014 Ben Fung, Hanna Halaburda Given technological advances and the widespread use of the Internet, various digital currencies have emerged. In most cases, Internet platforms such as Facebook and Amazon restrict the functionality of their digital currencies to enhance the business model and maximize their profits. While platform-based digital currencies could increase the efficiency of retail payments, they could also raise some important policy issues if they were to become widely used outside of the platform. Thus, it is important to closely monitor the evolution of these digital currencies. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Bank notes, Digital currencies and fintech, Financial services, Payment clearing and settlement systems JEL Code(s): E, E4, E41, E42
E-Money: Efficiency, Stability and Optimal Policy Staff Working Paper 2014-16 Jonathan Chiu, Tsz-Nga Wong What makes e-money more special than cash? Is the introduction of e-money necessarily welfare enhancing? Is an e-money system necessarily stable? What is the optimal way to design an efficient and stable e-money scheme? Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): E, E4, E42, E5, E58, L, L5, L51
The Efficiency of Private E-Money-Like Systems: The U.S. Experience with State Bank Notes Staff Working Paper 2014-15 Warren E. Weber In the United States prior to 1863 each bank issued its own distinct notes. E-money shares many of the characteristics of these bank notes. This paper describes some lessons relevant to e-money from the U.S. experience with state bank notes. Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Digital currencies and fintech, Financial services JEL Code(s): E, E4, E41, E42, E5, E58
Electronic Money and Payments: Recent Developments and Issues Staff Discussion Paper 2014-2 Ben Fung, Miguel Molico, Gerald Stuber The authors review recent developments in retail payments in Canada and elsewhere, with a focus on e-money products, and assess their potential public policy implications. Content Type(s): Staff research, Staff discussion papers Topic(s): Bank notes, Digital currencies and fintech, Financial services, Payment clearing and settlement systems JEL Code(s): E, E4, E41, E42
April 2, 2014 Briefing on Digital Currencies Remarks Grahame Johnson, Lukasz Pomorski Senate of Canada Ottawa, Ontario In an educational session on e-money to the Senate of Canada’s Standing Committee on Banking, Trade and Commerce. Grahame Johnson and Lukasz Pomorski highlight recent innovations in Canada’s payments system and the economic needs that these innovations satisfy. Content Type(s): Press, Speeches and appearances, Remarks Topic(s): Digital currencies and fintech