Privacy and the Functions of Digital Money
Central banks’ recent interest in exploring the potential of digital currencies raises the need for a fundamental understanding of how technical properties of the supporting infrastructure affect economic outcomes. One crucial aspect is information privacy: what information about the exchanging parties is revealed with each payment, and who has access to the record of historical payments? This project aims to propose new principled methods to evaluate the effect of privacy on the functions of digital money. It takes an interdisciplinary approach, integrating results and theories from computer science and new institutional economics, and applies them to the study of novel payment systems and information-centric theories of money.
The project is funded in Cluster 3, “Monetary system, cash, payment systems, and respective innovations,” of the OeNB’s Anniversary Fund.