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3 posts on "Currency"

August 12, 2020

Token- or Account-Based? A Digital Currency Can Be Both



LSE_2020_bitcoin_martin_460

Digital currencies, including potential central bank digital currencies (CBDC), have generated a lot of interest over the past decade, since the emergence of Bitcoin. The interest has only grown in recent months because of a desire for contactless payment methods, stemming from the coronavirus pandemic. In this post, we discuss a common distinction made between “token-based” and “account-based” digital currencies. We show that this distinction is problematic because Bitcoin and many other digital currencies satisfy both definitions.

Continue reading "Token- or Account-Based? A Digital Currency Can Be Both" »

Posted by Blog Author at 7:00 AM in Cryptocurrencies, Currency | Permalink | Comments (0)

June 12, 2020

How Fed Swap Lines Supported the U.S. Corporate Credit Market amid COVID-19 Strains



The onset of the COVID-19 shock in March 2020 brought large changes to the balance sheets of the U.S. branches of foreign banking organizations (FBOs). Most of these branches saw sizable usage of committed credit lines by U.S.-based clients, resulting in increased funding needs. In this post, we show that branches of FBOs from countries whose central banks used standing swap lines with the Federal Reserve (“standing swap central banks”—SSCBs) met their increased funding needs by accessing dollars that flowed into the United States through their foreign parent banks. This volume of dollar inflows accounted for at least half of the late March aggregate take-up at SSCB dollar operations.

Continue reading "How Fed Swap Lines Supported the U.S. Corporate Credit Market amid COVID-19 Strains" »

May 22, 2020

Have the Fed Swap Lines Reduced Dollar Funding Strains during the COVID-19 Outbreak?



LSE_Have the Fed Swap Lines Reduced Dollar Funding Strains during the COVID-19 Outbreak?

In March 2020, the Federal Open Market Committee (FOMC) made changes to its swap line facilities with foreign central banks to enhance the provision of dollars to global funding markets. Because the dollar has important roles in international trade and financial markets, reducing these strains helps facilitate the supply of credit to households and businesses, both domestically and abroad. This post summarizes the changes made to central bank swap lines and shows when these changes were effective at bringing down dollar funding strains abroad.

Continue reading "Have the Fed Swap Lines Reduced Dollar Funding Strains during the COVID-19 Outbreak?" »

Posted by Blog Author at 7:00 AM in Central Bank, Crisis, Currency, Pandemic | Permalink | Comments (1)
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