CBDC would have little effect on real economy – BoK paper

Researcher says CBDCs would have marginal but positive effects on output

Bank of Korea, Seoul

Central bank digital currencies, or CBDCs, would only have marginal effects on the economy and households’ welfare, according to a working paper published by the Bank of Korea.

Seonghoon Cho, an economics professor at Yonsei University, distinguishes between two types of bank deposits: non-interest-bearing demand deposits, or debit; and interest-bearing time and savings deposits.

He argues that debit provides liquidity, while interest-bearing time and saving deposits are assets to households. He

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