Over millennia, mankind has used hard cash in various forms ranging from shells to gold coins and paper. More recently, cash has become unpopular in political circles, as it effectively restricts states’ power to tax (explicitly or via negative interest rates) or to survey and potentially...

This paper studies the implications of money laundering for the optimal design of central bank digital currency (CBDC). I build a general equilibrium framework to explicitly allow money laundering by agents and income audits by a government. I find that as long as CBDC offers less anonymity than...

Chapter 1: Introduction and overview -- Chapter 2: Fiat money: History and features -- Chapter 3: Financial Technology sectors and business models -- Chapter 4: Cryptocurrency -- Chapter 5: Central bank digital currency -- Chapter 6: Neobanks -- Chapter 7: Digital currencies’ implications for...