Undergraduate Spring Panel: Cashless Societies: How Digital Currencies Are Reshaping the Economy

Across the world, the move towards cashless societies has gathered momentum, incorporating a variety of digital instruments ranging from payment apps to cryptocurrencies and central bank digital currencies (CBDCs). The new world of digital currencies and decentralized finance has generated much promise in addressing long-standing challenges within the currency, payments, and monetary ecosystem. In the meantime, critical issues related to digital currencies remain unresolved, raising a multitude of questions of theoretical and practical relevance. A key question surrounding digital currencies concerns their role in the prevailing monetary system, and the opportunities and risks associated with their adoption. While much has been explored on the potential benefits of digital currencies in facilitating financial inclusion and enabling unconventional monetary policy options, alternative arguments have been made over switching costs, displacement risks, and financial stability concerns. Understanding the implications of digital currency, as such, must entail the careful evaluation of the quality and suitability of digital currencies as money or value-bearing assets, in the context of today’s monetary-financial system and its institutional environments. A second related question pertains to the choice of technology and mechanism design, given the many alternative structural arrangements available. How should digital currency architecture and contracts be programmed? What technological platforms should they be based on? How can economic insights inform such choices to minimize risks and augment benefits to the transacting parties? All above lend to a critical research agenda concerning the nature, design, and use of digital currencies. Through the Undergraduate Spring Forum, we had a conversation with renowned economists on these topics and explored pertinent research questions arising out of the nascent yet expanding field.

The Undergraduate Spring Panel is an annual event organized by the College’s top economics students, who selected the speakers and moderated the conversation. This event was open to the full campus community.

Boxed meals were provided.

This event was available for in-person and virtual attendance.