Chapter 12 Digital Currency and International Fina...

Chapter 12 Digital Currency and International Finance
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Lead-in

The government of Thailand announced its plans to build a prototype national digital currency and test it out with a few large enterprises in the country.To that end, it has partnered up with Siam Cement Group (SCG), a major building material provider in the country.Siam Cement Group will integrate the central bank digital currency into its procurement and financial management systems and test it for half a year.The results are expected to be published in early 2021.

Source: Crytonews, June 19, 2020, https://cryptonews.com/news/new-tool-may-be-usedto-track-bitcoin-using-tax-evaders-more-6899.htm

Due to the information revolution, a new electronic payment method has been introduced,known as electronic cash, e-bag, e-currency, digital currency, digital money or digital cash.Without a doubt, the purpose of such an instrument is to improve the efficiency of the traditional payment method.In this chapter we deal with digital currency, which is a sort of currency available only in digital or electronic form.It has all intrinsic properties like physical currencies.A good illustration is that digital currency is allowed for instantaneous transactions and can be seamlessly executed for making payments across borders when connected to supported devices and networks.Thus, similar to any standard fiat currency, digital currency can be used to purchase goods and pay for services, though certain restrictions remain.We should also aware that such new form of currency provides a brand-new pattern of international finance.For instance, unlike physical currencies currently widespread in the global market, such as banknotes and minted coins, digital currency is intangible and can only be owned and transacted in by using computers or electronic wallets.Thus, we would like to take a deeper insight into features of digital currency and its current stage of development.