Bank of Korea paper says digital currency will not displace hard cash

Bank of Korea, Seoul
Bank of Korea

It is “unlikely” the cost of using digital currency will be low enough to “drive out” or crowd out the use of hard cash, according to a working paper published by the Bank of Korea.

In their paper, Crowding out in a dual currency regime? Digital versus fiat currency, KiHoon Hong, Kyounghoon Park and Jongmin Yu analyse whether the low cost of digital currency has the potential to make cash redundant, and vice versa.

“In a world of imperfect currencies, with uncertain costs associated with the

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