Central bank digital currencies (CBDCs) may signal the end of physical cash and thus propel interest in cryptocurrency from the darker side of society, according to Mike Dolan, editor-at-large for finance and markets at Reuters.

“Shadow economy” participants, those who use deal mostly in hard cash, are unlikely to be drawn to using a CBDC which may make it harder to stay anonymous, Dolan argues in his column for the news agency.

The “shadow economy,” as described by the International Monetary Fund (IMF), is an ecosystem of consumers and business owners who rely mostly on cash to avoid taxation and regulatory oversight.

This can include everything from sole traders to organized crime, and could be worth more than €2 trillion in the eurozone, nearly twice the €1.2 trillion worth of banknotes currently in circulation.

Dolan further suggests that crypto’s recent explosion is partly due to an expected surge in adoption in the shadow economy, as CBDCs are developed and the decline of cash accelerates.


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Central Bank Digital Currencies May Drive Cash 'Shadow Economy' to Crypto: Reuters

by Mario Herndon
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