Eggs in one basket: security and convenience of digital currencies

Saved in:

Authors and Corporations:

Kahn, Charles M. (Author), Rivadeneyra, Francisco (Author), Wong, Tsz-Nga (Author)

Other Authors:

Rivadeneyra, Francisco [Author] • Wong, Tsz-Nga [Author]

Edition:

Last updated: January 28, 2021

Type of Resource:

E-Book

Language:

English

published:

[Ottawa] Bank of Canada [2021]

Series:

Subjects:

Digital currencies and fintech

Financial services

Payment clearing and settlement systems

Central bank research

Graue Literatur

Source:

Verbunddaten SWB
Lizenzfreie Online-Ressourcen

Description
Summary:	Digital currencies store balances in anonymous electronic addresses. We analyze the tradeoffs between the safety and convenience of aggregating balances in addresses, electronic wallets and banks. In our model, agents balance the risk of theft of a large account with the cost to safeguarding a large number of passwords for many small accounts. Account custodians (banks, wallets and other payment service providers) have different objectives and trade-offs along these dimensions; we analyze the welfare effects of differing industry structures and interdependencies. In particular, we examine, the consequences of "password aggregation" programs, which, in effect, consolidate risks across accounts.
Physical Description:	1 Online-Ressource (circa 48 Seiten)