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Economic Commentary

Electronic Money and the Future of Central Banks

Computers and telecommunications devices may replace paper currency and checks—some day. Indeed, electronic methods of transferring money have become widely used. Recently, however, discussion of “electronic money” has taken a new turn, zeroing in on the extent to which holding new forms of electronic money eventually could make central banks obsolete, rendering them powerless to control inflation. This Commentary updates the old story of electronic funds transfers before introducing the new story of electronic money holdings as a metaphor for a larger question about the future of central banking.

The views authors express in Economic Commentary are theirs and not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System. The series editor is Tasia Hane. This paper and its data are subject to revision; please visit for updates.

Suggested Citation

Stevens, Edward. 2002. “Electronic Money and the Future of Central Banks.” Federal Reserve Bank of Cleveland, Economic Commentary 3/1/2002.

This work by Federal Reserve Bank of Cleveland is licensed under Creative Commons Attribution-NonCommercial 4.0 International