Cryptoliquidity: the blockchain and monetary stability

Caton, James

doi:10.1108/jepp-03-2019-0011

Cited by 13 publications

(5 citation statements)

References 60 publications

(85 reference statements)

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“…There are numerous relevant studies on BCT in supply chains in the existing literature. The current potential of BCT in industry and government organizations provides credibility to the trust that it has the potential to disrupt the entire economic sector and lead global digital innovation and growth (Caton and Policy, 2019; Filimonau and Naumova, 2020). The global industry is currently attempting to pinpoint the main circumstances in their business models where BCT can be useful (Kramer et al ., 2021).…”

Section: Review Of Literaturementioning

confidence: 99%

Unlocking the potential of blockchain technology in China’s supply chain: a survey of industry professionals

Farooq,

Shahzad,

Guan

et al. 2024

JEPP

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PurposeThis study aims to identify the essential elements impacting the adoption of blockchain technology (BCT) in supply chain management (SCM) by integrating the technology acceptance and information system success (ISS) models.Design/methodology/approachQuestionnaire-based data was collected from 236 supply chain professionals from Beijing. The proposed research framework was evaluated using structural equation modeling (SEM) by using SPSS 23 and AMOS 24 software.FindingsThe empirical findings specify the positive influence of total quality on perceived usefulness and compatibility. Further, perceived ease of use positively influences perceived usefulness, compatibility and behavioral intention. Moreover, perceived usefulness positively impacts compatibility and behavioral intention. Compatibility positively influences behavioral intention. Finally, technology trust was found to be a significant moderator between perceived usefulness and behavioral intention and between perceived ease of use and adoption intention to use BCT in SCM.Originality/valueThis study empirically develops the second-order construct of total quality, representing the ISS model. Furthermore, this study established how the ISS and technology acceptance models influence behavioral intention through compatibility. Finally, this study confirmed the moderating role of technology trust among perceived ease of use, perceived usefulness and behavioral intention.

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Section: Review Of Literaturementioning

confidence: 99%

Unlocking the potential of blockchain technology in China’s supply chain: a survey of industry professionals

Farooq,

Shahzad,

Guan

et al. 2024

JEPP

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“…In addition, fewer control mechanisms over cryptocurrencies, such as a central bank and interest rate, have led the blockchain technology to reduce the transaction cost of the banking system, especially in terms of cross-border transactions (Hassani et al 2018). Cryptocurrencies also equipoise the excess demand for money through market mechanisms when they are adopted, which can be an effective tool if there is no limitation for expanding the money stock as a safe unit of currency among eager individuals (Caton 2020). These aspects underline the potential benefits of cryptocurrencies as instruments of economic stability and efficiency.…”

Section: Introductionmentioning

confidence: 99%

“…Despite the disagreement regarding the impact of cryptocurrencies on economic variables, which occurs because of different views and regulations in various countries and institutions facing cryptocurrencies (Jiménez-Serranía et al 2022), stability solutions and mechanisms outside of the economic system, such as monetary policy, encourage the development of blockchain technology and cryptocurrencies because they may supply liquidity for demand alteration for money (Caton 2020). However, the way that cryptocurrencies behave with other economic variables and economic stability depends on the economic and political structure of the studied population.…”

Section: Introductionmentioning

confidence: 99%

“…Regulations and stability mechanisms can influence the efficiency of cryptocurrencies and blockchain technology toward economic stabilization (Caton 2020), which is one of the reasons for disagreement concerning the impact of monetary policy on cryptocurrencies. For instance, Bundesbank (2021) reports the impact of the European Union's monetary policy system on crypto tokens.…”

Section: Introductionmentioning

confidence: 99%

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Is Monetary Policy a Driver of Cryptocurrencies? Evidence from a Structural Break GARCH-MIDAS Approach

Alam,

Amendola,

Candila

et al. 2024

Econometrics

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The introduction of Bitcoin as a distributed peer-to-peer digital cash in 2008 and its first recorded real transaction in 2010 served the function of a medium of exchange, transforming the financial landscape by offering a decentralized, peer-to-peer alternative to conventional monetary systems. This study investigates the intricate relationship between cryptocurrencies and monetary policy, with a particular focus on their long-term volatility dynamics. We enhance the GARCH-MIDAS (Mixed Data Sampling) through the adoption of the SB-GARCH-MIDAS (Structural Break Mixed Data Sampling) to analyze the daily returns of three prominent cryptocurrencies (Bitcoin, Binance Coin, and XRP) alongside monthly monetary policy data from the USA and South Africa with respect to potential presence of a structural break in the monetary policy, which provided us with two GARCH-MIDAS models. As of 30 June 2022, the most recent data observation for all samples are noted, although it is essential to acknowledge that the data sample time range varies due to differences in cryptocurrency data accessibility. Our research incorporates model confidence set (MCS) procedures and assesses model performance using various metrics, including AIC, BIC, MSE, and QLIKE, supplemented by comprehensive residual diagnostics. Notably, our analysis reveals that the SB-GARCH-MIDAS model outperforms others in forecasting cryptocurrency volatility. Furthermore, we uncover that, in contrast to their younger counterparts, the long-term volatility of older cryptocurrencies is sensitive to structural breaks in exogenous variables. Our study sheds light on the diversification within the cryptocurrency space, shaped by technological characteristics and temporal considerations, and provides practical insights, emphasizing the importance of incorporating monetary policy in assessing cryptocurrency volatility. The implications of our study extend to portfolio management with dynamic consideration, offering valuable insights for investors and decision-makers, which underscores the significance of considering both cryptocurrency types and the economic context of host countries.

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“…Moreover, monetary theory can provide insights into the role of cryptocurrencies in the present economic landscape. Cryptocurrencies offer an avenue for acquiring liquidity at a reduced cost during times of crisis and have the potential to foster stability in macroeconomics (Caton, 2019).…”

Section: Introductionmentioning

confidence: 99%

Regulatory constraints, responsibilities and consultation (CRC) for legal institutionalization of cryptocurrencies in Pakistan

Khan,

Ullah,

Atiq

2023

QRFM

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Purpose This study aims to synthesize the existing literature with insights gained from interviews conducted with regulatory experts. The objective is to analyse the challenges associated with incorporating cryptocurrencies into regulatory frameworks and to explore constraints in the regulatory institutionalization of cryptocurrencies. Design/methodology/approach The study methodology consists of two steps. The first step is to identify regulatory constraints in the literature review and in the next step, interviews are conducted with officials of the State Bank of Pakistan (SBP). The study used a qualitative case study methodology, in which a single case (regulatory constraint) was selected as a unit of analysis. Findings The findings show that lack of traceability, legal status, lack of governmental control due to decentralization, difficulty enforcing laws, volatility, lack of skills with regulators and difficulty integrating cryptocurrencies into the current financial system are the main obstacles to the introduction of a regulatory framework. Thus, on a broader conceptual level, the findings can be grouped into opportunism, lack of strategic capability and fragmented global laws. Research limitations/implications This study could inform global cryptocurrency regulation discussions, sharing a developing country’s views on balancing the government, central banks, the financial sector and public interests. This could guide countries to consider cryptocurrency adoption in similar situations. This could affect the cryptocurrency market, impacting demand, supply and investor trust in Pakistan. Practical implications The study has implications for policy making officials. The research aims to offer valuable insights to the SBP and other regulatory authorities, helping them identify potential risks and create an effective regulatory framework for cryptocurrencies. Social implications The study has implications for society in knowing about the volatile nature of cryptos and anonymity of their issuers, which poses regulatory constraints. This then implies its harmfullness to its traders and the huge losses that may arise from their trading due to its volatile nature. Originality/value This study contributes to the literature on the constraints, responsibilities and consultation framework of cryptocurrency regulations.

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Cryptoliquidity: the blockchain and monetary stability

Cited by 13 publications

References 60 publications

Unlocking the potential of blockchain technology in China’s supply chain: a survey of industry professionals

Unlocking the potential of blockchain technology in China’s supply chain: a survey of industry professionals

Is Monetary Policy a Driver of Cryptocurrencies? Evidence from a Structural Break GARCH-MIDAS Approach

Regulatory constraints, responsibilities and consultation (CRC) for legal institutionalization of cryptocurrencies in Pakistan

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