Mardi | 2020-05-20
11H00 – Webinar
This paper estimates the effect of Bitcoin ownership on the level of consumer cash holdings, showing that adoption is indeed strongly correlated with cash holdings even after controlling for other relevant factors. We further model Bitcoin ownership itself to control for selection effects. Finally, we compute quantile regressions which demonstrate a highly non-linear effect of Bitcoin ownership on cash holdings. Our results provide evidence against the narrative that certain new technologies such as Bitcoin will necessarily lead to a decline in cash usage. Further, there are implications regarding the extent to which Bitcoin fulfills the store-of-value versus transactional functions traditionally associated with a currency.