Money, Bitcoin, and Monetary Policy

Kang, Kee-Youn; LEE, SEUNGDUCK

doi:10.1111/jmcb.12992

Cited by 5 publications

(2 citation statements)

References 35 publications

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“…( 2017 ) argued that Bitcoin is subject to the same economic factors as traditional fiat currencies, and is not entirely unaffected by government policies. Kang and Lee ( 2022 ) constructed a search-theoretic model to investigate how conventional money and Bitcoin facilitate transactions and concluded that benefits in an economy with both is lower than in a money-only economy due to surcharges in the confirmation of Bitcoin transactions. From an empirical viewpoint, Aharon et al.…”

Section: Literature Reviewmentioning

confidence: 99%

The linkage between Bitcoin and foreign exchanges in developed and emerging markets

BenSaïda

2023

Financ Innov

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This study investigates the connectedness between Bitcoin and fiat currencies in two groups of countries: the developed G7 and the emerging BRICS. The methodology adopts the regular (R)-vine copula and compares it with two benchmark models: the multivariate t copula and the dynamic conditional correlation (DCC) GARCH model. Moreover, this study examines whether the Bitcoin meltdown of 2013, selloff of 2018, COVID-19 pandemic, 2021 crash, and the Russia-Ukraine conflict impact the linkage with conventional currencies. The results indicate that for both currency baskets, R-vine beats the benchmark models. Hence, the dependence is better modeled by providing sufficient information on the shock transmission path. Furthermore, the cross-market linkage slightly increases during the Bitcoin crashes, and reaches significant levels during the 2021 and 2022 crises, which may indicate the end of market isolation of the virtual currency.

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Section: Literature Reviewmentioning

confidence: 99%

The linkage between Bitcoin and foreign exchanges in developed and emerging markets

BenSaïda

2023

Financ Innov

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“…Chiu and Koeppl (2022b) and Kang (2023) investigate double spending incentives in the Bitcoin system, and Choi and Rocheteau (2021) and Pagnotta (2022) study cryptocurrency pricing. Fernández‐Villaverde and Sanches (2019), Schilling and Uhlig (2019), and Kang and Lee (forthcoming) explore the macroeconomic implications of cryptocurrencies via currency competition. While these papers focus on analyzing the economic implications of technical features of digital currency, such as blockchain technology, we focus on the privacy issue of digital currency payments 3…”

Section: Introductionmentioning

confidence: 99%

Digital currency and privacy

Kang

2024

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We develop a monetary model in which a private company issues digital currency and uses payment data to estimate consumers' preferences. Sellers purchase preference information to produce goods that better match consumers' preferences. A monopoly arises in the digital currency industry, and digital currency is not issued if the inflation rate is sufficiently high. Due to reinforcing interactions between the value of preference information and trade volume, multiple equilibria (with and without digital currency) can exist, depending on market structures for monetary exchanges. When left to market forces alone, socially efficient uses of payment data may not occur.

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Revolutionizing finance with bitcoin and blockchain: a literature review and research agenda

Han,

Lu,

2024

CAFR

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PurposeOur analysis is targeted at researchers in the fields of economics and finance, and we place emphasis on the incremental contributions of each paper, key research questions, study methodology, main conclusions and data and identification tactics. By focusing on these critical areas, our review seeks to provide valuable insights and guidance for future research in this rapidly evolving and complex field.Design/methodology/approachThis paper conducts a structured literature review (SLR) of Bitcoin-related articles published in the leading finance, economics and accounting journals between 2018 and 2023. Following Massaro et al. (2016), SLR is a method for examining a corpus of scholarly work to generate new ideas, critical reflections and future research agendas. The goals of SLR are congruent with the three outcomes of critical management research identified by Alvesson and Deetz (2000): insight, critique and transformative redefinition.FindingsThe present state of research on Bitcoin lacks coherence and interconnectedness, leading to a limited understanding of the underlying mechanisms. However, certain areas of research have emerged as significant topics for further exploration. These include the decentralized payment system, equilibrium price, market microstructure, trading patterns and regulation of Bitcoin. In this context, this review serves as a valuable starting point for researchers who are unacquainted with the interdisciplinary field of bitcoin and blockchain research. It is essential to recognize the potential value of research in Bitcoin-related fields in advancing knowledge of the interaction between finance, economics, law and technology. Therefore, future research in this area should focus on adopting innovative and interdisciplinary methods to enhance our comprehension of these intricate and evolving technologies.Originality/valueOur review encompasses the latest research on Bitcoin, including its market microstructure, trading behavior, price patterns and portfolio analysis. It explores Bitcoin's market microstructure, liquidity, derivative markets, price discovery and market efficiency. Studies have also focused on trading behavior, investors' characteristics, market sentiment and price volatility. Furthermore, empirical studies demonstrate the advantages of including Bitcoin in a portfolio. These findings enhance our understanding of Bitcoin's potential impact on the financial industry.

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Money, Bitcoin, and Monetary Policy

Cited by 5 publications

References 35 publications

The linkage between Bitcoin and foreign exchanges in developed and emerging markets

The linkage between Bitcoin and foreign exchanges in developed and emerging markets

Digital currency and privacy

Revolutionizing finance with bitcoin and blockchain: a literature review and research agenda

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