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Bitcoin price growth and Indonesia's monetary system

Version 2 2024-06-06, 12:12
Version 1 2018-12-17, 15:37
journal contribution
posted on 2024-06-06, 12:12 authored by PK Narayan, S Narayan, R Eki Rahman, I Setiawan
Concerned by the volatility of Bitcoin price growth (BPG), Bank Indonesia—Indonesia's central bank—discourages trading cryptocurrencies. We examine the relationship between Bitcoin price growth (BPG) and Indonesia's monetary aggregates (inflation, real exchange rate, and money velocity). In doing so, we develop the conceptual link between Bitcoin and monetary aggregates. We find strong and robust evidence that BPG leads to inflation growth, currency appreciation, and a reduction in money velocity. Our results have policy implications for other central banks in terms of achieving stability of the monetary system if BPG is indeed a concern for those countries.

History

Journal

Emerging markets review

Volume

38

Pagination

364-376

Location

Amsterdam, The Netherlands

ISSN

1566-0141

eISSN

1873-6173

Language

eng

Publication classification

C1 Refereed article in a scholarly journal

Copyright notice

2018, Elsevier B.V.

Publisher

Elsevier