The Future of Money and Payments

Catalog description

In its exploration of the future of money and payments, this course focuses on technology, market competition, and public policy. Money and payments have long been dominated by physical cash and by transfers between deposit accounts of correspondent banks, including central banks. After a grounding in conventional payment systems, the course investigates ongoing improvements and disruptions of conventional approaches with new technologies, including instant payment systems, narrow banking, central bank digital currencies, and cryptographic applications such as blockchain-based digital ledgers, stablecoins, zero-knowledge proofs, smart-contract settlement, and automated market making. Policy concerns include financial inclusion, efficiency, disruption of banking, privacy, anti-money-laundering, financial stability, and monetary policy transmission. Grading is based on frequent short homework assignments and quizzes.