Money remains the best use case for blockchain technology and this is forcing us all to revisit our understanding of the nature of money.
In September 2017, the Bank for International Settlements (the central bank to the central banks) issued a paper exploring the questions and issues around central banks issuing their own cryptocurrencies.
This very useful paper adds to our understanding and sets out a taxonomy of money that is based four key properties of money as follows : Issuer (central bank or other); form (electronic or physical); accessibility (universal or limited); and transfer mechanism (centralised or decentralised).
The paper touches only very briefly on the important risks a retail cryptocurrency would bring. In particular the risk to the existing business models of commercial banks. They note that banks may be disintermediated (duh!), and hence unable to perform essential economic functions, such as monitoring borrowers. I have to say that ‘the banks’ have not done a great job in this aspect of their ‘economic role’. Remembering here the GFC and more recently to unfolding ‘liar loans’ scandal at Australian banks.
The BIS article is here.