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on Financial Literacy and Education |
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Issue of 2022‒05‒02
three papers chosen by |
| By: | Daniela Balutel; Marie-Hélène Felt; Gradon Nicholls; Marcel Voia |
| Abstract: | Since 2016, the Bank of Canada has conducted annual surveys to monitor awareness, adoption and usage of Bitcoin and other cryptocurrencies (Henry et al. 2018, 2019a, 2019b). This report incorporates results from the 2019 Bitcoin Omnibus Survey and the November 2020 Cash Alternative Survey. We find that between 2018 and 2020, the level of Bitcoin awareness and ownership among Canadians remained stable: nearly 90% of the population were aware of Bitcoin, while only 5% owned it. We find that about half of Bitcoin owners stated they usually obtained their bitcoins through mobile or web exchanges, while one-fifth used mining. Bitcoin owners were susceptible to certain risks, as evidenced by the fact that about half of current and past owners stated they had been affected by events such as price crashes, losing access to funds, scams or data breaches. The most commonly cited reasons for owning Bitcoin were related to its use for investment or based on interest in the technology. Bitcoin owners displayed greater knowledge about the Bitcoin network than non-owners, yet they scored lower on questions testing financial literacy. |
| Keywords: | Bank notes; Digital currencies and fintech; Econometric and statistical methods |
| JEL: | E4 C12 O51 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocadp:22-10&r= |
| By: | Franklin Allen; Xian Gu; Julapa Jagtiani |
| Abstract: | Fintech and decentralized finance have penetrated all areas of the financial system and have improved financial inclusion in the last decade. In this paper, we review the recent literature on fintech, cryptocurrencies, stablecoins, and central bank digital currencies (CBDCs). There are important implications from the rise of fintech and the introduction of stablecoins and CBDCs in recent years. We provide an overview of China’s experience in fintech, focusing on payments, digital banking, fintech lending, and the recent progress on its CBDC pilots (e-CNY). We also discuss important considerations in designing effective cryptocurrency regulations. Cryptocurrency regulations could promote growth of innovations through enhanced public confidence in this market. The e-CNY could become mainstream in the global market through effective regulations, which provide incentives and protection to market participants. A key factor to success for digital currencies has been their widespread adoption. If the Chinese e-CNY were to become a mainstream currency, the introduction of CBDC could potentially offer solutions to existing problems inherent in traditional financial systems. |
| Keywords: | fintech; cryptocurrency regulations; stablecoins; CBDCs; e-CNY; China |
| JEL: | G21 G28 G18 L21 |
| Date: | 2022–04–11 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:93944&r= |
| By: | Doerr, Sebastian; Kabas, Gazi; Ongena, Steven |
| Abstract: | Does population aging affect bank lending? To answer this question we exploit geographic variation in population aging across U.S. counties to provide the first evidence on its impact on bank risk-taking. We find that banks more exposed to aging counties experience deposit inflows due to seniors' higher savings rate. They consequently extend more credit, but relax lending standards: Loan-to-income ratios increase and application rejection rates decline. Exposed banks also see a sharper rise in nonperforming loans during downturns, suggesting that population aging may lead to financial instability. These results are in line with an increase in savings and a decline in investment opportunities induced by population aging. |
| Keywords: | Risk-taking, financial stability, low interest rates, population aging, demographics |
| JEL: | E51 G21 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:112426&r= |