Jonathan Chiu - Latest

• On the Programmability and Uniformity of Digital Currencies

  Staff Working Paper 2025-18 Jonathan Chiu, Cyril Monnet

  Central bankers argue that programmable digital currencies may compromise the uniformity of money. We develop a stylized model to examine this argument and the trade-offs involved in circulating programmable money.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): E, E5, E50, E58

• Public and Private Money Creation for Distributed Ledgers: Stablecoins, Tokenized Deposits, or Central Bank Digital Currencies?

  Staff Working Paper 2024-35 Jonathan Chiu, Cyril Monnet

  This paper explores the implications of introducing digital public and private monies (e.g. tokenized central bank digital currency [CBDC] or tokenized deposits) for stablecoins and illicit crypto transactions.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Financial stability, Monetary policy JEL Code(s): E, E5, E50, E58

• Decentralized finance: Innovations and challenges

  Staff Analytical Note 2023-15 Jonathan Chiu, Hanna Yu

  Decentralized finance surged in popularity around 2020. We explore its value and limitations and highlight some potential regulatory concerns.

  Content Type(s): Staff research, Staff analytical notes Research Topic(s): Digital currencies and fintech, Financial stability, Payment clearing and settlement systems JEL Code(s): G, G1, G2

• Understanding DeFi Through the Lens of a Production-Network Model

  Staff Working Paper 2023-42 Jonathan Chiu, Thorsten Koeppl, Hanna Yu, Shengxing Zhang

  We develop a production-network model to capture how decentralized finance (DeFi) has evolved across different sectors of financial services. The model allows us to measure the value added by different DeFi sectors and to study how the connections across the sectors influence token prices.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): G, G2

• On the Fragility of DeFi Lending

  Staff Working Paper 2023-14 Jonathan Chiu, Emre Ozdenoren, Kathy Yuan, Shengxing Zhang

  We develop a dynamic model to capture key features of decentralized finance lending. We identify a price-liquidity feedback: the market outcome in any given period depends on agents' expectations about lending activities in future periods, with higher future price expectations leading to more lending and higher prices in that period.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Financial stability JEL Code(s): G, G0, G01, G1, G10

• Central Bank Digital Currencies and Banking: Literature Review and New Questions

  Staff Discussion Paper 2023-4 James Chapman, Jonathan Chiu, Mohammad Davoodalhosseini, Janet Hua Jiang, Francisco Rivadeneyra, Yu Zhu

  We review the nascent but fast-growing literature on central bank digital currencies (CBDCs), focusing on their potential impacts on private banks. We evaluate these impacts in three areas of traditional banking: payments, lending and liquidity and maturity transformation. We also take a broader look at CBDCs and highlight two promising directions for future research.

  Content Type(s): Staff research, Staff discussion papers Research Topic(s): Central bank research, Digital currencies and fintech, Financial institutions, Financial stability JEL Code(s): E, E5, E50, E58, G, G0, G00, L, L0, L00

• Grasping De(centralized) Fi(nance) Through the Lens of Economic Theory

  Staff Working Paper 2022-43 Jonathan Chiu, Charles M. Kahn, Thorsten Koeppl

  We analyze the value proposition and limitations of decentralized finance (DeFi). Based on a distributed ledger and smart contracts, DeFi can guarantee the execution of financial contracts, potentially lowering the costs of intermediation and improving financial inclusion.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): G, G2

• PayTech and the D(ata) N(etwork) A(ctivities) of BigTech Platforms

  Staff Working Paper 2022-35 Jonathan Chiu, Thorsten Koeppl

  Why do BigTech platforms introduce payment services? We explore this using a model in which a monopoly platform faces a trade-off between the costs associated with privacy concerns and the revenue from data services. We then analyze the feedback effects between data and payments.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): D, D8, E, E4, E42, L, L1

• What Drives Bitcoin Fees? Using Segwit to Assess Bitcoin's Long-Run Sustainability

  Staff Working Paper 2022-2 Colin Brown, Jonathan Chiu, Thorsten Koeppl

  We explore what drives transaction fees in the Bitcoin system and consider whether Bitcoin can remain tamper proof in the long run.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Payment clearing and settlement systems JEL Code(s): E, E4, E42, G, G2

• Central Bank Digital Currency and Banking: Macroeconomic Benefits of a Cash-Like Design

  Staff Working Paper 2021-63 Jonathan Chiu, Mohammad Davoodalhosseini

  Should a CBDC be more like cash or bank deposits? An interest-bearing, cash-like CBDC not only makes payments more efficient but also increases total demand. This has positive effects on other transactions, inducing more deposit taking and lending and, thus, bank intermediation.

  Content Type(s): Staff research, Staff working papers Research Topic(s): Digital currencies and fintech, Monetary policy, Monetary policy framework JEL Code(s): E, E5, E50, E58