Possible economic consequences of digital cash

Research output: Contribution to journalArticle

16 Citations (Scopus)

Abstract

Digital cash brings benefits as well as problems. One major advantage of digital cash is its increased efficiency opening new opportunities, especially for small businesses. On the other hand, it will encourage potentially the worsening of problems over taxation and money laundering. In turn, these problems may alter foreign exchange rates, disturb money supplies, and encourage an overall financial crisis. The transnationality of digital cash - the ability of digital cash to flow freely across national borders - encourages these benefits and problems, and could have significant repercussions internationally. From an economic view, this transnationality is the most important characteristic of digital cash. If digital cash behaved like traditional currencies, circulating within a national border and controlled by a central monetary authority, there would be few economic implications that would be worth analyzing. In this scenario, digital cash would be nothing more than a convenient transaction method such as a credit card. However, digital cash's very transnationality has the potential to cause conflict between cyberspace and nation states. If digital cash spreads successfully in the next century, its history may be written as a transcript of economic battles between nation states.

Original languageEnglish
JournalFirst Monday
Volume1
Issue number2
Publication statusPublished - 1996
Externally publishedYes

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transnationality
Economics
national border
nation state
economics
money supply
money laundering
increased efficiency
foreign exchange
small business
virtual reality
taxation
currency
financial crisis
transaction
credit
scenario
cause
Electronic money
ability

ASJC Scopus subject areas

  • Computer Networks and Communications
  • Human-Computer Interaction
  • Law

Cite this

Possible economic consequences of digital cash. / Tanaka, Tatsuo.

In: First Monday, Vol. 1, No. 2, 1996.

Research output: Contribution to journalArticle

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