Abstract Author discusses possible consequences of digital cash from the view of economics and forcasts a possible scenario for the future. Digital cash will bring us benefits as well as problems. One major benefit of digital cash is its increased efficiency which will open new business opportunities, especially for small businesses. There is one important attribute of digital cash, however, that overshadows these benefit and problems. It is the transnationality of digital cash, that is, the ability of digital cash to flow freely accross national borders.
Every bank can issue it and everybody all over the world can use it.
This transnationality is a cause for both benefits and problems, and could have significant repurcussions internationally. From the economic stand point, the most important characteristic of digital cash is its transnationality. If digital cash circulated only within a traditional national border and was controlled under a central monetary authority, there would be no economic implications that would be worth analyzing. In this case, digital cash would be nothing more than a convenient transaction method such as a credit card. However, digital cash is more than that.