<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Historically, financial and monetary innovations have triggered positive and negative changes in the everyday operations of the financial sector. Similarly, digital currencies can significantly reshape the future of banking and financial intermediaries. Whether the aspect of digital currencies is through the public sector such as in central banks, digital currencies, or private means such as in cryptocurrencies, the eventual rollout of such innovative instruments has a critical influence on the retail use of digital assets. At the same time, digital currencies may create new risks and vulnerabilities in the financial or banking sector whose implications should be thoroughly assessed. However, the magnitude of the risks depends on the designs and policies attached to the digital currencies in use. These features of digital currencies trigger the subject of discussion in this paper. By outlining the benefits and risks associated with digital currencies in the banking sector, the paper aims to highlight the overall impact of digital currencies in the banking sector and available remedies to control the risks. Therefore, the paper provides information that is critical to the banking sector policymakers interested in digital currencies.</p>
</abstract>

Historically, financial and monetary innovations have triggered positive and negative changes in the everyday operations of the financial sector. Similarly, digital currencies can significantly reshape the future of banking and financial intermediaries. Whether the aspect of digital currencies is through the public sector such as in central banks, digital currencies, or private means such as in cryptocurrencies, the eventual rollout of such innovative instruments has a critical influence on the retail use of digital assets. At the same time, digital currencies may create new risks and vulnerabilities in the financial or banking sector whose implications should be thoroughly assessed. However, the magnitude of the risks depends on the designs and policies attached to the digital currencies in use. These features of digital currencies trigger the subject of discussion in this paper. By outlining the benefits and risks associated with digital currencies in the banking sector, the paper aims to highlight the overall impact of digital currencies in the banking sector and available remedies to control the risks. Therefore, the paper provides information that is critical to the banking sector policymakers interested in digital currencies.

The Influence of Digital Currency on the Banking Sector in Europe

Economic Themes

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

{"article-title":"The Influence of Digital Currency on the Banking Sector in Europe"}

Historically, financial and monetary innovations have triggered positive and negative changes in the everyday operations of the financial sector. Similarly,...

The Influence of Digital Currency on the Banking Sector in Europe

Published Online: Apr 05, 2023

Page range: 481 - 494

Received: Jul 05, 2022

Accepted: Nov 28, 2022

DOI: https://doi.org/10.2478/ethemes-2022-0026

Keywords
Digital Currencies, Banking Sector, Benefits, Risks, Design, Policies

© 2022 Milena Jakšić et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

The Influence of Digital Currency on the Banking Sector in Europe

Published Online: Apr 05, 2023

Page range: 481 - 494

Received: Jul 05, 2022

Accepted: Nov 28, 2022

DOI: https://doi.org/10.2478/ethemes-2022-0026

KeywordsDigital Currencies, Banking Sector, Benefits, Risks, Design, Policies

© 2022 Milena Jakšić et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
Digital Currencies, Banking Sector, Benefits, Risks, Design, Policies